Africa Urges G20 to Provide $500 Billion to Poorest Countries

The United Nations (UN) Economic Commission for Africa urged the G20 countries (the richest nations) to take measures that can provide $500 billion for the world's poorest countries.

The UN commission affirms that funds help avoid lasting negative impacts as a result of a long-term funding gap caused by the COVID-19 pandemic.

The plan calls for four measures to provide immediate aid, and its publication came ahead of the special meeting of the Group of Twenty (G20), which will be held tomorrow, Friday; it is expected that financial officials will complete work on a common framework to deal with debt problems in the poorest countries in the world.

The plan proposes to extend the deadline for the debt service suspension initiative until the end of 2021 or perhaps until the end of 2022.

It also suggests an increase in financing through special drawing rights and establishes facilities to help countries meet short-term debt payments, as well as providing payment for lending from development banks.

"Even the strongest economies will struggle to survive an ongoing liquidity crisis, led by successive waves of the pandemic around the world," an Economic Commission for Africa document said.

"Africa's resistance will collapse if global policymakers remain indifferent or intimidated in their response. It is a shared responsibility," it added.

Signs are increasing that the pandemic is exacerbating the problems of the poorest countries, more than half of which are now at risk of default.

G20 officials agreed in October to extend the freeze on official bilateral debt payments under the Debt Service Suspension Initiative to the first half of 2021 and said they would consider another six-month extension in April.

But the Economic Commission for Africa said that the short term has increased the difficulty countries face in planning and implementing programs to protect their citizens beyond the middle of next year and has limited measures to prevent longer-term structural damage to their economies.