By Africa Links 24
Published on 2024-03-02 16:58:56
Africa is a continent that has faced numerous challenges due to the global financial system, and as a result, it must look within for solutions, according to Mthuli Ncube, Zimbabwe’s Minister of Finance, Economic Development, and Investment Promotion. Speaking at the 56th Session of the Economic Commission for Africa Conference of African Ministers of Finance, Planning, and Economic Development in Victoria Falls, Zimbabwe, Ncube emphasized the need for Africa to address the theme of the event, which focused on financing the transition to inclusive green economies in Africa.
Ncube stressed the importance of taking a comprehensive approach to drive this transition, highlighting the significance of domestic revenue mobilization and the utilization of Africa’s own resources, such as its tax base, arable land, and investment opportunities. He also emphasized the need to attract private sector investment in climate change adaptation and mitigation projects to facilitate the transition to a green economy.
In addition, Ncube called for a reevaluation of the international financial architecture, pointing out that Africa has often been marginalized in global financial decision-making processes. He stressed the importance of ensuring that the international financial system is aligned with the needs and interests of African countries.
One of the key challenges facing Africa is rising debt distress, with Sub-Saharan Africa’s indebtedness reaching $833 billion in 2022. Public debt ratios have also increased significantly over the past decade, limiting African countries’ fiscal and monetary policy options in response to external shocks and financial pressures.
Furthermore, Ncube highlighted the tightening access to finance and increasing costs associated with borrowing, as advanced economies raise interest rates and international investors become more risk-averse. This environment makes it difficult for African countries to manage their debt obligations, leading to tough policy decisions and limited financial flexibility.
Despite these challenges, Ncube expressed optimism about Africa’s potential to become a global leader in climate action and sustainable development. He emphasized the importance of leveraging Africa’s renewable energy resources and natural assets to drive industrialization, economic diversification, and digital transformation on the continent.
Ncube concluded by encouraging technocrats and government officials to collaborate and share insights to inform decision-making processes and policy development. By working together and leveraging Africa’s strengths and resources, Ncube believes that the continent can overcome its challenges and achieve sustainable economic growth and development.
