The Afrocentric nationalism in Femi Gbajabiamila, the Speaker of Nigeria's House Representatives has never been in doubt. It went a notch higher on Monday, 17 August 2020 when he rallied his counterparts across the African continent for concerted efforts for an enduring solution to the expected post-coronavirus pandemic through external debts cancellation.
Gbajabiamila's increasing discomfort with the disconcerting reports from international monetary organizations, such as the World Bank Group 2018 report on African external debt trend, led to his push for the establishment of the Conference of Speakers and Heads of African Parliaments (CoSAP).
Having looked at the state of Nigeria's economy and the impact of COVID-19 on the health sector and the economy as a whole, Gbajabiamila noted that something needed to be done. One way he identified is by addressing the high debt service burden on the country.
Recently, it was reported that the International Monetary Fund (IMF) projected that debt servicing will take up all of Nigeria's revenue in 2020.
The situation in Nigeria is almost replicated in most countries in Africa.
With a range of analytical papers on the impact of debt servicing on Nigeria and other African countries, Gbajabiamila felt that though African countries have to be responsible for the loans they take, there are stronger moral and humanitarian imperatives to consider, especially in the context of Covid-19.
Before the outbreak of Covid-19, most African countries were heavily indebted. The pandemic has, however, compounded the problem. This is because the percentage of national budgets devoted to debt servicing would invariably assume a frightening dimension at the expense of development. A World Bank Group International Debt Statistics showed that total African debt stocks reached US$502 billion in 2018, up by 7% from the previous year.
International studies showed that "While, overall debt levels have not reached the alarming levels of the late 1990s, interest payments have; reaching 10-15% of exports in Sub-Saharan Africa in 2017. African debt is increasingly held in foreign currency, so the cost of repayment has skyrocketed with the strength of the US Dollar.
"Thus, despite lower debt ratios, twenty countries are already in debt distress or at risk of it. African countries have seen a 142% increase in the amount of service paid on debt between 2011 and 2018, reaching a total of $48 billion. This sum is projected to grow further to an expected $57 billion by 2021 - an increase of 18%.
"In 2018, the largest payments were made by South Africa ($12 billion), Angola ($7.4 billion), and Egypt ($7.2 billion). Together these three accounted for 55% of all debt service payments from the continent."
The effects of debt servicing on socio-economic development are enormous as it makes planning a near-impossible task. According to a new analysis by the Jubilee Debt Campaign, "32 African states spend more on debt repayments than they do on healthcare.
"Together sub-Saharan African countries paid $35.8 billion in total debt service in 2018, 2.1% of regional GDP. By freeing up these resources, and additional monetary resources across the continent spent on debt servicing, these resources could be made available for social and economic development".
This compelling scenario appears to have convinced Gbajabiamila that African Speakers and Heads of Parliaments, as elected representatives of the people, have to speak up and help find solutions for the continent. Given the fact that several voices outside the continent - including parliamentarians in Europe and America - are already calling for Africa's debt relief or cancellation, African Speakers and Heads of Parliaments could not keep silent.
Countries and monetary organizations outside the continent are unrelenting in campaigns for debt relief or cancellation for Africa. For instance, since the G20 Finance Ministers agreed on bilateral debt relief for the rest of 2020, many campaigning groups have shifted focus towards multilateral and private debt relief.
On May 13, US Congresspersons, Bernie Sanders and Ilhan Omar, sent a letter to the heads of the IMF and World Bank to ask for multilateral debt cancellation for all IDA countries and a major issuance of Special Drawing Rights in the order of trillions. The letter was signed by over 300 members of Congress and Parliaments from around the world.
In line with the UN Secretary-General report, "'Debt and COVID-19: A Global Response in Solidarity': UN-DESA has called for (i) a full standstill on all debt service (bilateral, multilateral and commercial) for all developing countries that request it, while ensuring that developing countries without high debt burdens still have access to credit; (ii) additional debt relief for highly indebted developing countries to avoid defaults and create space for SDG investments; and (iii) progress in the international financial architecture, through fairer and more effective mechanisms for debt crisis resolution, as well as more responsible borrowing and lending".
In view of this, Gbajabiamila opined that African governments have a moral duty to join these voices calling for debt cancellation and also reflect on the role of parliamentarians in helping to avoid African countries incurring more debts and staying trapped in a debt cycle.
Gbajabiamila said African Speakers urgently need a platform for increased interaction, collaboration and exchange of ideas and the Conference of Speakers and Heads of African Parliaments (CoSAP) would be an effective platform that would enable African Speakers to also seek to advance the African development agenda within and outside the continent in conjunction with the Executive arms of government as well as African regional institutions.
It was, therefore, no surprise when he commented at the inaugural zoom conference of the CoSAP that: "We all agreed that Africa's debt burden has become an existential threat to our societies, our economies and the future we leave to posterity, and we need to do something about this and treat it as a continent-wide priority."
Participants at the inaugural zoom conference were Hon. Tagesse Chafo, Speaker, House of Peoples Representatives, Ethiopia; Rt. Hon. Prof. Aaron Mike Oquaye, PhD, Speaker of Parliament, Ghana; Hon. Justin Bedan Muturi, Speaker, National Assembly, Republic of Kenya; Rt. Hon. Donatille Mukabalisa, Speaker, Chamber of Deputies, Rwanda; and President Moustapha Niasse, AFP, President, National Assembly, Senegal.
They were unanimous on the need for a united African Speakers' forum to make debt cancellation a reality going by the threat it posed on security and development in the continent.
Immediate relief of debt repayments would free up government budgets to spend on the emergency response. This year alone, it would free up at least $55 billion in Africa and $57 billion in 2021.
Speaking at the meeting, Rt. Hon. Prof. Aaron Mike Oquaye, Speaker of Parliament, Ghana, who assured of his readiness to bring other African heads of parliament into CoSAP, noted that the debt burden is essentially a common challenge on the continent, as most African countries have to depend on foreign loans to execute their national budgets.
He, however, noted that the Speakers' group, in its efforts to push for debt cancellation, must be able to convince the creditors about accountability if they hope to succeed.
He said: "Donor agencies are interested in accountability because they are confounded about the issue of corruption, and we must be able to give the assurance and that is why the Speakers Conference is critical. And if nothing is done, there may be no economy to service the loans."
Hon. Justin Bedan Muturi, Speaker, National Assembly, Republic of Kenya also emphasised the need for the initiative, adding that the coronavirus pandemic has undermined most African economies because conditions attached to most of the loans have been eroded by the consequences of the novel pandemic.
With Gbajabiamila's push, it is evident that the African continent would benefit tremendously when the move yields fruitful results.
- Anofi is the Special Assistant on Print Media to the Speaker, House of Representatives