The President of Ghana, Nana Addo Dankwa Akufo-Addo has blamed the woes of Africa on three outstanding international forces.
The COVID pandemic, Russia-Ukraine War and the Skewed financial structure, he noted during his address at the 77th General Assembly of the United Nations.
The President for the umpteenth time touched on the Covid pandemic noting that it brought the world to a “thundering halt” and pushed the African continent into the “worst” economic recession.
“As we cowered from a health pandemic from an unknown, malicious virus, coupled with a devastating global economic pandemic. High budget deficits were no longer concerns of only developing nations.
“By 2021, COVID-19 had pushed Africa into the worst recession for half a century. A slump in productivity and revenues, increased pressures on spending and spiralling public debts confronted us without relent.”
On the war, President Akufo-Addo noted that Africa is literally feeling the war in its pocket.
“It is not just the dismay that we feel at seeing such deliberate devastation of cities and towns in Europe in the year 2022, we are feeling this war directly in our lives in Africa. Every bullet, every bomb, every shell that hits a target in Ukraine, hits our pockets and our economies in Africa”.
Skewed International Financial Structure
Another important problem he raised was the imbalance in the international financial structure.
According to President Akufo-Addo, financial markets have been set up and operate on rules designed for the benefit of rich and powerful nations, and, during times of crisis, the façade of international cooperation, under which they purport to operate, disappears.
He noted that the spillover from central banks raising interest rates to combat inflation has caused global investors to pull money out of developing economies to invest in bonds in the developed world.
“This has led to depreciating currencies and increased borrowing costs; meaning we need to raise and spend more of our own currencies to service our foreign debts in US dollars. It has become clear, if ever there was any doubt, that the international financial structure is skewed significantly against developing and emerging economies like Ghana. The avenues that are opened to powerful nations to enable them take measures that would ease pressures on their economies are closed to small nations.”
He added, “To make matters worse, credit rating agencies have been quick to downgrade economies in Africa, making it harder to service our debts. The tag of Africa as an investment risk is little more than, in substance, a self-fulfilling prophecy created by the prejudice of the international money market, which denies us access to cheaper borrowing, pushing us deeper into debts.
He then noted that there is a need for reforms of the systems.
Source: opemsuo.com/Hajara Fuseini