IMF calls for ‘another Gleneagles moment’ on debt relief and aid

theguardian.com:

Western countries need to put together adebt relief and aid package to match that of the landmark Gleneagles summit deal in 2005 in order to counter a severe funding squeeze affecting struggling African countries, the International Monetary Fund has said.

Abebe Selassie, the director of the IMF’s African department, said without a scaling up of financial support some of the world’s poorest countries would have no chance of meeting the 2030 UN goals for poverty reduction.

“We need another Gleneagles moment,” he said in an interview with the Guardian before the release of the IMF report on the state of countries in sub-Saharan Africa.

At the Gleneagles summit 18 years ago, the G8 group on industrialised countries agreed to double aid to Africa and announced a comprehensive package of debt relief. Selassie said something similar was now required.

The IMF official said that even before the pandemic it looked like a “tall order” for low-income countries in Africa to meet the UN’s 2030 sustainable development goals. Now recent shocks – Covid 19, higher inflation and the war in Ukraine – had made the situation “very difficult”.

Selassie added that countries needed help not just to alleviate poverty but to meet the challenge of global heating. “The inexorable logic of climate change is beginning to affect the region,” he said. “Nobody expected the series of shocks seen in recent years.”

The IMF expects annual growth in sub-Saharan Africa to slow from 4.2% to 3.6% this year, as its countries suffer a “big funding squeeze” tied to the drying up of aid and being frozen out of global capital markets.

Selassie said: “The effect of the pandemic was to push countries into a clearly unsustainable financial position in some cases such as Chad