Obiageli (Oby) Ezekwesili is a former Nigerian cabinet minister, a former vice-president of the World Bank, a co-founder of Transparency International and a co-convener of the #BringBackOurGirls campaign in response to the kidnapping of schoolgirls by Boko Haram.
Today, Africa is home to more than 70 per cent of the world’s extreme poverty, with more than 400 million people affected across the continent. Many countries are severely constrained by budgetary crises caused by poor domestic revenue mobilization, high public debts and low productivity. Health facilities often suffer from chronic shortages of critical drugs, causing many patients to die of easily curable or treatable diseases.
And that was before the COVID-19 pandemic struck.
It is no surprise that this crisis, which has dealt a disproportionate injury to the most vulnerable in the world, has devastated the African countries that lack the buffer required to offer fiscal relief. Volatile commodity prices over the course of the worsening pandemic have only injected more instability into already parlous public finances. So while economies in Asia, Europe and the Americas have announced hefty emergency stimulus packages for their people and businesses, countries in Africa are struggling to meet even the short-term food needs of their poor and vulnerable populations that have been asked to comply with lockdowns.
But while there have been calls for voluntary international aid to support the continent during this difficult time, this is a fundamentally misguided proposal. The solution is not giving aid to Africa – not after yet another powerful country’s failure to act responsibly collapsed the continent’s economic growth and eroded the little gains of development it managed to make after the previous global crisis. It is time to make offending rich countries pay the poor ones a kind of “global risk-burden tax” for delaying their lift out of poverty.
In short, what Africa must first be accorded in this particular crisis are damages and liability compensation from China – the rich and powerful country that reportedly failed to transparently and effectively manage this global catastrophe.
The current economic conditions mirror what happened to Africa during the 2008 global financial crisis. As the vice-president in charge of the World Bank’s operation in Africa at the time, I had to mobilize internal and partner resources to mitigate the severity of economic recession suffered by the continent. I watched as exogenous shocks dealt a lethal blow to the countries’ decade-long steady rises of economic growth, which had averaged 5 per cent to 6 per cent annually until they tumbled to 2.4 per cent in 2009.
This sharp fall ended Africa’s upward economic growth trajectory and sent per-capita income tumbling as well, worsening the number of Africans in absolute poverty and increasing inequality. Such fragile and low economic-growth rates for a continent with the largest number of young people and an annual population growth rate of 2.5 per cent is a key reason for widespread multidimensional poverty – a threat that carries the seeds of global insecurity and instability.
Now, the economic shock has been caused by a crisis that emerged from China. It is one that has badly reduced the opportunity Africa would otherwise have had to lift hundreds of millions out of poverty and reduce inequalities. The African Union Commission estimates that Africa’s gross domestic product will, as of now, shrink by as much as 4.5 per cent, resulting in 20 million job losses. This has dangerously hampered the possibility that Africa can generate jobs for young people and women, increase literacy levels by reducing the number of out-of-school children with access to quality learning opportunities, reduce maternal and child mortality, improve nutrition and food security, make reliable energy available and accessible, improve availability of quality roads, water and sanitation, and invest seriously in public goods.
China should demonstrate world leadership by first acknowledging that it did, in fact, fail to rise to an acceptable and reasonable standard of transparency necessary to deliver a fast and concentrated global response to COVID-19 before its infections exploded internationally. Beijing’s leadership should then commit to an independent expert panel evaluation of the way it handled the pandemic since it was first reported in December, 2019.
The results of that evaluation should guide China’s next steps, which should include considerations for a complete write-off of the more than US$140-billion that its government, banks and contractors extended to African countries between 2000 and 2017. This would provide partial compensation for the impact COVID-19 is already having on their economies and people. The analysis of the balance of compensation due to Africa can then follow from discussions with the African Union and its member countries, alongside global and regional organizations including the United Nations, the World Bank, the International Monetary Fund, the African Development Bank and the European Union. Then, China and the rest of the Group of 20 countries should engage with the African Union and countries to design a reparations mechanism.
After all, China has achieved an economic miracle over the past four decades by lifting more than 800 million of its people out of poverty. Surely it understands how critical it is for African countries to accelerate inclusive growth.
Our world is already overdue for a change of approach in the way it manages global risks – particularly the ones that leave the poor worse off because of failures of the rich and powerful. It’s a new normal shaped by climate change, terrorism, health crises, food insecurity, crime and more – and often these risks emanate from the more privileged countries. The development burden cannot continue to disproportionately be borne by the poor and vulnerable.
The current model of development assistance is broken; it can never deliver any real change of fortune. We need a new governance model that strengthens citizens so they can engage in the design of their pathway out of poverty and build health and economic resilience.
So it is time to design that. And it starts with China giving the poor in Africa what is due to them. China must pay.
The Globe and Mail
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