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Managing public debt amidst COVID-19 financing pressures in Africa

The COVID-19 pandemic is expected to push Africa into a deep recession in 2020 and beyond. With lower growth expected, reduction in tax collections, stimulus packages, as announced and reallocations in Budgets towards health and social protection, the impact of COVID-19, has posed enormous challenges for public debt management in Africa.

Building on the fruitful African dialogue at the Kampala conference in February 2020 and the first virtual workshop between public debt managers in Africa on 20 May 2020, as hosted by CABRI/ODI and government of Uganda, the enormity, of both internal and external challenges public debt managers, is facing, were emphasized.

COVID-19 has deepened the debt burden to an extent, where countries felt some form of financial relief is needed or where the debt burden should rather be shared between lenders and issuers. Although the IMF and World Bank and others are assisting Africa countries, with special loan facilities, the relief are short term of nature and not considering the longer-term effects of the higher borrowing requirements.

On June 25, CABRI held an online exchange between public debt managers and other stakeholders to share experiences on the impact of COVID-19 on public debt management in Africa. The agenda was as follows:

• Rising debt levels and inherited risks in Government’s debt portfolios prior to COVID-19 by Johan Krynauw, Programme Manager, CABRI

• Impact and debt related responses to COVID 19 in the West African region (francophone countries) by Adrien Diouf, Managing Director of AGENCE UMOA -Titres

• Managing public debt under a financial distress situation, with the focus on long term sustainability by Stanislas Nkhata, Director of the Debt Management Programme, MEFMI

• Impact of COVID-19 and downgrades on public debt in South Africa by Alilali Nelufule, Acting Director, Liability Management, National Treasury of South Africa.

The discussants were:

• Maris Wanyera, Director of Debt and Cash Policy, Ministry of Finance, Planning and Economic Development, Republic of Uganda

• Permaud Justin Kouassi, Ministère Chargé de l’Economie et des Finances, Côte d'Ivoire

We apologise for the technical glitches encountered during the webinar

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