A money changer counts Nigerian currency notes for a customer in Nigeria's commercial capital, Lagos, March 16, 2020. (Photo File/Temilade Adelaja)

Coronavirus: Ethiopia Seeks Debt Relief, Budgetary Support for Africa

ADDIS ABEBA – Ethiopian Prime Minister Abiy Ahmed has urged G-20 leaders to boost Africa’s response to the coronavirus pandemic through emergency budgetary support and debt relief.

Ethiopia believes Africa’s ability to take measures to inject liquidity and cushion its companies and workers from the impact of the virus are constrained by the heavy debt burden.

The continent is expected to fork out at least 44 billion US dollars for all interest payments this year, according to United Nations.

Addis Ababa says the current COVID-19 challenges they require a globally coordinated response and submitted a three-point intervention for G-20 countries leaders’ summit.

“Ethiopia proposes all interest payment to government loans should be written off. In addition, Ethiopia proposes part of the debt of low-income countries should be written off,” Abiy’s office said in a statement.

“We suggest the remaining debt to be converted into long term low interest loans with 10 years grace period before payment. All debt repayments will be limited to 10% of the value of exports,” it added.

It said African economies will also be vulnerable in the face of “a dramatic decline in exports, disruption of global chains, and the sudden drying up of travel and tourism”.

Ethiopia proposed a 150 billion US dollars emergency health and budgetary support package from the World Bank and crisis financing from the International Monetary Fund.

The East African nation is also looking for support to the World Health Organization (WHO) to strengthen public health delivery and emergency preparedness in Africa.

Abiy’s proposal comes one day after African finance ministers called for 100 billion US dollars in “immediate emergency economic stimulus”.

Without a coordinated aid effort for the continent, the coronavirus would “have major and adverse implications on African economies and the society at large,” the ministers warned last week.

Image: A money changer counts Nigerian currency notes for a customer in Nigeria’s commercial capital, Lagos, Nigeria, March 16, 2020. [Photo Reuters]