African countries need $1.2 trillion through 2023 to resolve the challenges that resulted from the coronavirus outbreak, said Kristalina Georgieva, managing director of the International Monetary Fund (IMF).
Georgieva made her statements during the high-level virtual event on Mobilising with Africa, part of the IMF and World Bank annual meetings that will kick off officially on 12 October.
She said that some African countries are suffering from high debt burdens, forcing them to choose between debt service and additional social and health spending.
Current commitments from international financial institutions and official bilateral creditors are projected to meet less than a quarter of this need.
“With private capital still subdued, we face a projected gap of over $345 billion through 2023, and nearly half this burden is in Africa’s low-income countries,” said Georgieva.
She added that African countries spent an additional 2.5 percent of GDP on health and social programmes to meet their peoples’ needs amid the ongoing crisis, while international financial institutions have provided significant financial assistance in fast-track support for them, which included around $26 billion from the IMF, and this is what has been helping them fight the virus and curb the economic repercussions on people and businesses.
In Africa, there are more than a million infected cases with 23,000 deaths. Family incomes are down by 12 percent and up to 43 million people are at risk of extreme poverty, said Georgieva.
To ease the situation, Georgieva noted the IMF is working to extend the required support for these countries, including financial, surveillance and capacity development programmes. The IMF is also cooperating with international financial institutions to play a role in this regard.
Georgieva stressed that without adopting extra reforms over policies and institutions in Africa, external support will not be sufficient or effective.