African leaders tackle climate change, debt, and free trade at top-level summit

By Ronda Naidu

African leaders tackle climate change, debt, and free trade at top-level summit

The 36th Ordinary Session of the African Union (36th Summit of the AU) marked a milestone in February 2023 when it elected Azali Assoumani, the President of Comoros, as its chair making Assoumani the first head of an island state to lead the continental union. With the island and coastal states being extremely vulnerable to climate change, it is expected that climate issues will move up the AU agenda.

On climate change

During his inaugural speech, Assoumani mentioned a number of priority areas that are on the radar during his presidency of the AU, with climate change being among these.

“Although Africa is only responsible for about 3% of emissions [globally], it affects the lives of our citizens. The AU should continue to make itself heard as it did during the COP27,” Assoumani said, calling for the speedy disbursement of the loss and damage fund adopted at COP27.

Assoumani’s call came amidst UN statements that the continent’s island and coastal states would incur about US$50 billion in damages by 2050 due to rising sea levels, cyclones, drought, etc., seriously affecting about 116 million people living there.

Attending the summit, UN Secretary-General Antonio Guterres backed Assoumani’s position, “The brutal injustice of climate change is on full display with every flood, drought, famine and heatwave endured on this continent. The countries least responsible for this crisis are feeling its most devastating impacts.”

Guterres praised a number of large-scale climate-related projects that have been implemented on the continent and called on developed countries to provide “a tidal wave of support” to those African countries committed to put impactful climate programs in place.

On debt

Africa’s foreign debt has soared significantly since 2011, accounting for 41% of the continent’s total GDP in 2021, which is more than $US726 billion. The burden is becoming increasingly onerous since Africa is known to be among the debtors paying some of the world’s highest interest rates on its external debt. In 2021, about 20 countries on the continent paid 20% of their revenues on interest on their external debt.

Referring to the need to address the debt issue, Assoumani noted that African countries would need US$1 trillion to pay this off. As a means to ensure debt sustainability, he called for “the establishment of a common debt settlement framework, which will be more inclusive, integrating bilateral and multilateral creditors, and also private creditors, with enhanced support from the IMF”.

Moreover, Assoumani advocated for “a total cancellation of the African debt to allow a recovery of the post-Covid economy and to allow us to face the negative impacts of the crisis in Ukraine”.

Assoumani’s concerns had been raised previously by experts who noted that the Russian war against Ukraine would make it increasingly difficult for Africa to service its external debt, given the war-triggered energy crisis and the continent’s dependence on grain supplies from both countries.

On continental free trade

To foster economic growth against this unfavorable background, Assoumani urged all African countries to ratify the African Continental Free Trade Area Agreement (AfCFTA) which has so far been approved by 46 out of 54 countries. The AU chair called on the private sector to assist in accelerating the implementation of the AfCFTA, pointing out that Africa’s share in world trade “is stagnating at 4%”.

AfCFTA is closely aligned with Agenda 2063 which has over a 90% convergence with the United Nations Sustainable Development Goals.

According to a World Bank-AfCFTA report, the continental free trade area has the potential to create almost 18 million jobs and could help up to 50 million of the continent’s soon-to-be population of three billion people out of extreme poverty.

“Today Africa is one of the least integrated regions globally. African countries trade more with the outside world than with each other. The pact can help countries to simplify and harmonize trade and transit procedures, improve infrastructure, transport and logistics and spur the flows of goods, services, capital, and people that are so vital for development,” said Wamkele Mene, Secretary-General of the AfCFTA Secretariat.

However, the World Bank notes that “its [AfCFTA] full potential will depend on putting in place significant policy reforms and trade facilitation measures”.