Africa urged to target ‘smart debt relief’
Lusaka – UNICEF urged African countries to push for debt relief so they can increase their social spending.
In a new report titled “A Looming Debt Crisis. Smart Debt Relief, ”the United Nations children’s agency said that money spent on debt servicing was better used for social protection and investments in health.
“Something has to change. Using debt relief to support increased investment in human capital is part of the answer. We call this smart relief. Unlike the coronavirus, the debt crisis in Africa is not new. Debt has, in fact, almost doubled, on average over the past decade, ”the report says.
“Smart debt relief must be seen as the first step in a much broader program of support for the continent, for its children and its economic and development potential.”
According to IMF and World Bank projections, Africa will be the slowest growing region in the world this year, and an estimated 50 million people on the continent have been pushed into extreme poverty by the COVID-19 in the past year.
In addition, Unicef estimates that more than 100 million African children have not attended school since 2020, and that hunger and malnutrition are on the rise. Add to this the re-emergence of health threats, cholera, malaria and measles, there are growing calls for sustainable debt relief for African countries.
Unicef, in its report, urged the G20 to extend the Debt Service Suspension Initiative, which is due to end in December, saying this will allow developing country governments to guarantee social spending.
“Most importantly, smart debt relief must be complemented by additional support, including grants and highly concessional financing, so that countries in sub-Saharan Africa have a realistic chance of closing financing gaps and protecting human capital, ”added Unicef.