Coronavirus: African finance ministers call for $100 bn stimulus and debt holidays

Coronavirus: African finance ministers call for $100 bn stimulus and debt holidays

- Finance ministers in Africa have jointly called for a suspension of debt service payments in the wake of the spread of the coronavirus

- The plan is to direct available funds towards dealing with the epidemic

- In the last 10 years, total debt owed by sub-Saharan activities has increased to almost 60% of the Gross Domestic Product (GDP)

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Finance ministers in Africa, have requested for a $100 billion stimulus and a suspension of debt service payments.

The call, YEN.com.gh has learned, is part of a strategy to help the continent deal with the coronavirus.

Per a Reuters report, the sources for funding the debts include the World Bank, the International Monetary Fund (IMF) and the African Development Bank (AfDB).

Coronavirus: African finance ministers call for $100 bn stimulus and debt holidays

President of African Development Bank, Akinwumi Adesina Source: Ghana Talks Business
Source: UGC

READ ALSO: Ken Ofori-Atta: Finance minister says World Bank, IMF and others would help Ghana fight coronavirus

It is expected that the proposed interest payment waiver would include interest payments on public debts as well as sovereign bonds.

It is also hoped that the waiver would help with an immediate fiscal space and liquidity that governments need to combat the coronavirus.

The ministers reached an agreement to the effect that a plan to waive both the principal debt and interest for fragile states should be considered.

Information available shows that the total debt owed by sub-Saharan activities has increased to almost 60% of the Gross Domestic Product (GDP) over the last decade.

In other news, the Minister of Finance, Ken Ofori-Atta, has shed light on the plan the government has adopted to finance the fight to eliminate the coronavirus from Ghana.

According to him, the government could source funds from the International Monetary Fund (IMF), the World Bank and the Stabilization Fund.

These sources of funding, he went on, would help close the budgetary gap which is likely to be created by the fiscal impact of the coronavirus on Ghana’s economy.

Ofori-Atta noted that it has become necessary to consider these sources as others such as the petroleum, tourism and aviation industries have been negatively affected by the coronavirus.

READ ALSO: Latest Fitch report shows Ghana's growth rate may fall to 6.2%

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