Africans place priority on AfCFTA, debt-for-climate swaps at UNECA meeting
Earlier this week, the Conference of African Ministers of Finance, Planning and Economic Development wrapped up in Addis Ababa with an emphasis on how African nations can take action on climate change while developing their economies.
Support for the evolving African Continental Free Trade Area (AfCFTA) was high on the agenda, along with innovative strategies like debt-for-climate swaps to ease the debt burdens confronted by many African states.
“Coming out of the low levels of income and wealth is now being made more challenging by climate change as seen in the recent flooding in Madagascar, Malawi, and Mozambique,” said Albert Muchanga, above, the commissioner for Trade and Industry of the African Union Commission. “We must add to this, the looming debt crisis which could undermine all the growth achievements of the past 23 years.”
The United Nations Economic Commission for Africa (UNECA), which hosted the event, reports that the government debt-to-GDP ratio in Africa was 64.5% in 2022. At least 22 African nations are believed to be facing debt crises, while between 60% and 82% of the population lives in poverty in the 10 poorest African nations, including Madagascar, Malawi and Mozambique, as well as Central African Republic, Somalia, and South Sudan.
Hanan Morsy, Deputy Executive Secretary and Chief Economist for UNECA, said that mounting climate challenges are making Africa’s existing economic situation more daunting.
One solution discussed in Ethiopia was the possibility of debt-for-climate swaps, which permit countries to exchange climate commitments and protections for debt forgiveness. The model has been used effectively in Seychelles, where a deal brokered with the China Global Conservation Fund of The Nature Conservancy and other partners allows the Indian Ocean island nation to cancel debt in exchange for placing 30% of its ecologically sensitive land under protection.
Image: UNECA
Laureen Fagan
Laureen is the editor of Africa Times
Laureen is a freelance journalist creating high-quality, informed content on international affairs, politics and technology. She has worked both in and out of newsrooms since 2000. She is a former paramedic with significant experience in community resilience and nonprofit community development initiatives, and maintains "a passion for action" on sustainability and climate change. She also is trained in conflict resolution and diversity, and has special interests in science and medical reporting, and culture and religion issues. Laureen received her MSJ from Northwestern University's Medill School of Journalism in the United States, and completed additional graduate study in theology at University of Notre Dame. Follow Laureen on Mastodon at @laureen@m.ai6yr.org
