“In most African countries, debt mortgages the future of rising generations”

VHere is the full text of the Royal message read out by the Minister of Economy and Finance, Nadia Fettah Alaoui.

“Praise to God.

Peace and salvation be upon the Prophet, his family and his companions.

Excellencies,

Ladies and gentlemen,

We are pleased to welcome the honorable guests of Morocco, who are taking part in the 2022 edition of the Meeting of the African Group of Ministers of Finance and Governors of Central Banks of African Member States of the World Bank and the International Monetary Fund. (African Caucus). This is all the more true since We took it to heart to place this assembly under Our High Patronage.

From the outset, we would like to salute the crucial role that the African group has played since its creation in 1963, and which consists in giving African governors a more audible voice within the Bretton Woods Institutions, with regard to the challenges linked to the socio-economic development of the countries of our continent.

Excellencies,

Ladies and gentlemen,

As you know, the world was barely emerging from the grip of the Covid-19 pandemic when the global economy found itself caught in a spiral of unprecedented supply chain disruptions and subject to mounting inflationary pressures and to a record rise in the prices of energy, food products and raw materials. Clearly, such upheavals have damaging effects on societies.

This crisis affects African countries unequally, its effects varying according to the economic potential and the needs of each in terms of raw materials, in particular energy and food.

In this difficult situation, our continent appears to be one of the most affected regions, both in view of the multiple dangers threatening its food and energy security and the drop in its economic growth rates. Social conditions are thus greatly degraded in many African countries.

In a context of scarcity of concessional financing and tightening of the conditions for their allocation, the increase in financing needs is leading to a sharp rise in debt servicing, which further weighs down the economic situation of many African countries.

Therefore, stronger support and more consistent international cooperation for African countries are more necessary than ever to save them from being severely affected by the inflationary wave that is hitting the world economy and to help them develop a stronger resilience to external shocks.

Excellencies,

Ladies and gentlemen,

Admittedly, the international community, in particular the International Monetary Fund and the World Bank, has mobilized extensively to come to the aid of the countries successively affected by the Covid-19 pandemic and the Ukrainian crisis. This is how measures and initiatives have been taken for them to lighten the burden of debt service, reduce their financing deficit and preserve their external balances.

But these initiatives, although laudable, remain insufficient, given the magnitude of the challenges that African countries face in their quest for sustainable and integrated development. Indeed, it must be recognized that structural deficiencies still persist in economic growth models and social protection networks in Africa.

As you know, many African economies are undiversified and largely based on the export of raw materials. In addition to agricultural sectors largely dependent on the vagaries of the weather, they suffer from poor development of the considerable demographic potential at their disposal.

In order to correct these shortcomings, efforts must be intensified to draw up integrated development programs based on clear objectives and innovative financing instruments. These mechanisms should place the African citizen at the heart of their concerns and be based essentially on highlighting the opportunities for economic integration between African countries. They also assume an active involvement of the continent in the dynamics of digital transformation and energy transition at work in the world.

Excellencies,

Ladies and gentlemen,

By holding its meetings in this unique context, the African Caucus of finance ministers and central bank governors offers the opportunity to analyze the challenges facing our countries and to discuss the means likely to help them deal.

In this regard, We welcome the relevance of the issues on the agenda of this meeting, foremost among which are the problem of debt, the challenges of digitization and climate change.

With regard to debt, it is unanimously considered to be one of the major economic challenges for all African countries. This question rightly challenges the entire international community. In fact, in most African countries, debt burdens the limited resources allocated to the development process a little more every day. Moreover, it mortgages the future of rising generations and jeopardizes their legitimate right to prosperity.

In this regard, with the assistance of other financial, regional and international organizations, the Bretton Woods institutions can propose technical solutions and appropriate financing formulas which would enable African countries, particularly those with low incomes, to better manage their indebtedness. . But these financing solutions remain of a purely cyclical nature if we consider the colossal financing deficit from which African countries suffer, currently confronted with gigantic financing needs, estimated annually at hundreds of billions of dollars.

With this in mind, it is important to develop new financing options with a structural vocation, relying essentially on increased mobilization of local resources. For this, it is necessary to undertake structural reforms aimed at improving the yield of tax systems, increasing the efficiency of public expenditure, strengthening the attractiveness of foreign investment, and developing public-private partnerships.

On another note, climate change is one of the most pressing challenges for the African continent, given the seriousness of its impacts, which have a lasting effect on all aspects of life in our countries.

Although African countries contribute the least to greenhouse gas emissions, the main cause of climate change, they are paradoxically among the most vulnerable to the consequences of this phenomenon, following successive years marked by drought, scarce rainfall, increased desertification.

Given the particular nature of the climate challenge, a global phenomenon that resists individual solutions, the international community should be receptive to the demands made in this regard by African countries.

It is also its responsibility to mobilize the financial and technical resources necessary to support the countries of the Continent in their efforts to curb the effects of climate change or to adapt to it.

This is all the more true since Africa is the only continent to receive only a tiny fraction of the funds promised under the Paris Climate Agreement.

Correlatively, our African States are called upon to reorient their development models towards more sustainable modes of production and consumption, given the constraints imposed by climate change, both in terms of available natural resources and economic choices.

Excellencies,

Ladies and gentlemen,

High indebtedness and climate change are major challenges that jeopardize the stability of African economies as well as the sustainability of their development models. On the other hand, the digital transition offers African countries immense development opportunities which should be taken advantage of.

In fact, digital technology constitutes a structural change in the way of apprehending the world around us, because it allows the emergence of new patterns of production and consumption likely to increase investment opportunities and consequently create more jobs.

In addition, digital media are remarkable tools for raising the level of financial inclusion and for extending the scope of health coverage and social protection.

Nevertheless, as an economic choice, digitalization requires a sufficient number of specialized human resources, the rooting of this culture within the various segments of society, as well as the establishment of technical infrastructures in line with the rapid changes in that sector.

Although this technology involves complex issues that are difficult to face, there is a need to accelerate the pace of digitization of our African societies, in order to bridge the gap that separates us from advanced countries and therefore be able to harvest the fruits of the digital transformation on a planetary scale.

In order to meet this challenge, it is important to make the necessary financial and human resources available, in particular it is necessary to take advantage of profiles from Africa capable of providing digital solutions adapted to the cultural and social specificities of our respective countries.

Excellencies,

Ladies and gentlemen,

South-South cooperation remains the best way to promote economic development in the countries of the Hemisphere.

On the strength of its unchanging conviction and its constant commitment, Morocco now has significant achievements to its credit in the form of structuring projects, such as the gas pipeline project between Morocco and Nigeria, which should greatly contribute to strengthening energy security. many African countries.

In addition, notwithstanding the challenges related to the current crisis, the progress made in the operationalization of the African Continental Free Trade Area (ZLECAF) once again attests to the capacity of the countries of the Continent to strengthen their economic integration according to a common vision. .

The effective implementation of this zone as soon as possible will speed up the integration of African economies among themselves and in global value chains; the south-south trade and economic cooperation We call for will certainly be strengthened.

In addition, We take this opportunity to invite once again, Our bilateral and multilateral partners to support the efforts constantly deployed by the States of Our Continent, in terms of development.

This support, which is part of a win-win strategic partnership, will enable African States to acquire sufficient resources to promote the dynamics of sustainable development and, ultimately, to ensure their respective peoples the conditions for a decent and peaceful.

We commend the commendable efforts that you are tirelessly deploying to support action aimed at meeting the challenges of socio-economic development in our Continent. We once again welcome you to Morocco and We extend to your honorable assembly Our best wishes for every success in its work.

Wassalamou alaikoum warahmatoullahi wabarakatouhou”.

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