Bright Simons Argues Against Debt Cancellation For For African Countries And Explains Why It Is Not Viable

• Bright Simons policy analyst at IMANI Centre For Policy And Education has argued on the Doha Debates podcast that African countries do not need debt cancellation
• He argued that the global campaign for debt cancellation for African countries does not respect local diversity and the nuances
• Speaking in favour of debt cancellation during the podcast on Tuesday was Heidi Chow, executive director of the UK-based nonprofit, who argued that debt payments shouldn’t come before essential human needs

IMANI's Bright Simons has presented strong arguments against a push for debt cancellation for African countries.

According to the policy analyst at the renowned think tank, the arguments for debt cancellation frequently offered by proponents in the past no longer apply in the present times.

“Because the nature of who is lending has changed, the debates we all supported around the early 2000s about owing debt no longer apply," he said.

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He made the comments when he joined the Doha Debates for a podcast on Tuesday, July 25, 2023, to discuss the current push for African debt cancellation.

The discussion comes shortly after the G20 finance ministers convened in July to discuss debt cancellation for developing countries, among other topics.

The podcast was hosted by Nazanine Moshiri, a journalist and a senior analyst at the International Crisis Group in Nairobi.

Simons makes strong points against debt cancellation

The Ghanaian social innovator, entrepreneur and writer, argued that in the early 2000s, 80% of Africa’s debt was owed to official creditors (IMF, World Bank) and rich country governments.

"Why is that important? It’s important because they lent the money on the basis of programs…In those circumstances, if the countries can’t pay back, you need to share the blame - between those who gave the money for those programs, and made an input into those programs, and the government," he added.

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He said in the case of private investors, they don’t have that influence.

"If Ghana’s policy fails, and the Ghana government cannot pay back, we cannot expect the same degree of blame sharing," he clarified his a point.

Ghana's controversial National Cathedral pops up in Bright Simons' arguments against debt cancellation

Arguing further, Bright Simons also questioned Ghana's fiscal responsibility as controversy grows over National Cathedral which is estimated to cost $1 billion.

“If we just simply say, everything is the fault of the global system, everything is the fault of the international system, we lose out..

"We have to ask hard questions of Global South leaders and ask that they reform their fiscal systems," he said.

He cited Nigeria's fiscal expenditure to buttress his arguments against debt cancellation:

“Last year, the government of Nigeria collected about $22 billion in taxes. They spent nearly $10 billion in subsidies for petroleum products, the bulk of which is consumed by rich people. When you spent nearly 40% of what you collected as a government in an investment that for the most part benefits the upper middle class -- you cannot turn around and say because we are spending so much on debt, we need debt cancellation.”

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The regular BBC commentator's main argument is that the global campaign for debt cancellation for African countries does not respect local diversity and nuances and that debt cancellation is not viable.

"We have been down this road before. We spent $125 billion of global resources in giving debt relief to countries in the Global South - 33 countries in Africa benefited from debt relief. It opened the door for them to begin to borrow commercially which led to its own risks," he said.

Heidi Chow presents arguments in favour of debt cancellation for African countries

Speaking in favour of debt cancellation for African states during the podcast was Heidi Chow, executive director of the UK-based nonprofit Debt Justice.

Heidi argued that debt relief is needed.

She explained that debt payments shouldn’t come before essential human needs.

She said rather than tightening the screws on indebted countries, the global system must address the predatory lending practices that have pushed many global south countries to the brink of collapse.

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It’s estimated that three out of five low-income countries are struggling to pay their debts.

In Africa, 21 countries are either bankrupt or in financial distress, and are on the hook to repay more than $70 billion in 2023 alone.

Bright Simons alleges brokers and middlemen linked to Bawumia’s office profiting from gold for oil policy

Meanwhile, YEN.com.gh has reported in a separate story that policy analyst Bright Simons has said there are rife reports that middlemen linked to Dr Mahamudu Bawumia's office are profiting from the gold-for-oil policy.

According to the vice president of IMANI Centre for Policy and Education, there is a bad report by an anti-government media on the policy.

The gold-for-oil policy is the government's solution to tackling cedi depreciation and rampant fuel price increases.

Source: YEN.com.gh