Africa/Rising poverty and inequality threaten Sustainable Development Goals
Development experts have warned that persistent poverty and inequality risk undermining prosperity, peace and security in Africa unless governments engage in innovative and participatory development models.
It is becoming increasingly unlikely that African states will achieve many of the targets set out in the 2030 Sustainable Development Goals," says Deputy Executive Secretary and Chief Economist of the Economic Commission for Africa (ECA), Hanan Morsy.It is becoming increasingly unlikely that African states will achieve many of the targets set out in the 2030 Sustainable Development Goals," says Hanan Morsy, Deputy Executive Secretary and Chief Economist of the Economic Commission for Africa (ECA),
"Global shocks have wiped out more than two decades of progress the continent has made in reducing poverty. We need sustainable interventions.
In light of this, ECA organized a roundtable discussion at the 55th Conference of African Ministers of Finance, Planning and Economic Development for experts to brainstorm and recommend actions to help member states reduce their economic and social vulnerabilities and inequalities.
Harvesh Seegolam, Governor of the Bank of Mauritius, explains that when the COVID19 pandemic hit in 2020, Mauritius' tourism sector came to a halt. To mitigate the effects of the downturn, the government proposed both conventional and unconventional measures. One of these was to make the Central Bank of Mauritius an independent institution.
"The government introduced moratoriums to support targeted sectors; introduced the alignment credit," says Seegolam, adding that the government is now in a position to provide support to the private sector. Seegolam, adding that the government also created the Mauritius Investment Cooperation, which operates independently of the Central Bank, and has independent audits to ensure that the money invested is benefiting the bank.
The Mauritius Investment Cooperation's main objective is to create more wealth for the country's future generation. The intervention has become profitable.
Ethiopia's finance minister, Ahmed Shide, says Ethiopia, like any other African country, was affected by overlapping shocks - Covid19, the war in Ukraine, conflict and drought - and that the country's response includes a combination of fiscal and monetary policies.
Precautionary measures, he said, were put in place to contain Covid19. The government has deferred personal income tax payments, rescheduled bank loan repayments, granted tax amnesty to various sectors, stimulated local food production by cultivating more land and boosted meat production. The government has embarked on more irrigation activities and expanded Ethiopia's airline and digital payment systems to facilitate transactions.
The Central African Republic's Minister of Finance and Budget, Hervé Ndoba, says the country faces fuel shortages, high transportation costs for basic commodities mainly because it is a landlocked country.
"To address these challenges, the government has created a dry port with warehouses for importers, set up customs levies to limit import inflation. Specifically, the government has created a customized base to take advantage of production costs and has adjusted fuel prices at the pump," says Ndoba.
"Our goal is to increase domestic product through community levies. We are working on financial diversification, namely green financing and the blue economy.
According to the Executive Director of the Joint United Nations Programme on HIV/AIDS, Winnie Byanyima, the biggest challenge for Africa is access to financial services. Even before the Covid-19 crisis, the war in Ukraine, countries were borrowing at interest rates of over eight percent (8%), while high-income countries were borrowing at lower rates of up to one percent (1%).
The high cost of borrowing, she says, is robbing Africa of the prospects of achieving the SDGs. In addition, the challenge of not being able to borrow in countries' own currencies shows how unequally countries are treated in terms of access to affordable finance.
"The discussion on financing Africa is important as we approach the MDG Summit in September 2023,"Byanyima says, adding that there is a need for countries to address the issue of access to finance.The discussion on financing for Africa is important in the run-up to the MDG Summit in September 2023," Byanyima said, adding that there is a need for countries to address the high cost of debt, link financing to the achievement of the MDGs, and make more efforts to ensure that Africa has a seat at the G20 forum.
The Acting Executive Secretary of the Economic Commission for Africa (ECA), Antonio Pedro, says Africa is lagging further behind other regions of the world.Africa is lagging behind other regions of the world and now accounts for the largest share of the world's poor due to rising poverty and inequality. As a result, many African countries are facing declining incomes, increasing debt stress and limited fiscal space, all of which limit their ability to respond to economic crises.
He argues that partnerships are key to addressing African challenges.