Speech

Summit on Financing African Economies

Ladies and gentlemen,

The Covid-pandemic presented all countries worldwide with an enormous economic challenge. But it is an uneven challenge.

While developed economies are able to devote 20% of their GDP to economic recovery, developing economies are only able to go as far as 6% of their GDP.

The IMF estimates that the external funding gap for recovery in Africa is around 300 billion dollars. This imbalance can seriously hamper global recovery.

Belgium wants to take its responsibility and play an active role in supporting this global recovery, towards a more sustainable and inclusive global economy.

First, we are pledging to increase our financial assistance towards low income countries through the initiatives of the international financial institutions.

We will take an active part in the multilateral discussion to explore and contribute to several technical options: SDRs, IDA, concessional financing…

Second, debt relief – whether we are talking ‘canceling’ or ‘restructuring’.. - is part of the solution, part of the global approach we need;

But we have to make sure this global approach is productive.

Two points are crucial for Belgium in this respect:

  1. First of all, debt relief and financial assistance must come together with good governance, the respect for human rights and the respect for the rule of law. If this basic requisite is not met, financial support makes little sense. Because without the rule of law and without human rights, no productive economy is possible. As far as Belgium is concerned, the two are inextricably linked. Following the same philosophy, the recipient countries should also be better guided in their future finance management, in order to make it more robust. This is why Belgium will support the Académie fiscale francophone at OECD, to boost domestic resources mobilization.
  2. Secondly, debt relief must be done on an objective basis. I do not see debt relief as a favor. On the contrary, avoiding new debt cycles is a way to accelerate sustainable development. That is why the objective analysis by the IMF and the World Bank should be the guiding texts. Together with sound business climate, it will help the private sector do its part, too.

Ladies and gentlemen,

The goal is clear: we all want debt relief to lead to more productive and sustainable investments and more jobs for Africa.

It is something we must do together, in close cooperation with one another. So that all partners - debtors and creditors alike– can be held accountable.To make sure national debt is no longer an unbearable burden for a country, but a tool to take control of one's own economic destiny; an instrument to create a better living standard for its citizens. Belgium is firmly convinced this ambition is within reach if our countries represented today use their leverage to work together towards this common goal.