The African Regional Organisation of the International Trade Union Confederation (ITUC -Africa) has called on both World Bank and International Monetary Fund (IMF) to urgently prioritise and execute the restructuring of Africa’s debt
General Secretary of ITUC -Africa, Comrade Akhator Joel Odigie in a statement said such move would safeguard social economic rights and ensure economic stability.
Comrade Akhator Joel while expressing concern at the current situation in Zambia, called for urgent public debt treatment that would guarantee protection of Zambian citizens’ fundamental human rights and well-being.
The statement reads “Like many African nations, Zambia grapples with a constricting web of debt that significantly limits its fiscal flexibility. Extensive research spanning various African countries, including Zambia, underscores the correlation between mounting debt and escalating inequality.
“It is established that the burden of unsustainable debt severely hampers the government’s capacity to allocate funds to essential sectors like infrastructure, health, and education while inhibiting the implementation of vital social protection measures.
“Consequently, revenues earmarked for crucial social services that should support lower income groups are diverted towards servicing the debt, resulting in a detrimental impact on pivotal areas such as healthcare and education.
“This, in turn, leaves a void that directly affects the working class, who disproportionately bear the consequences of diminished access to quality healthcare and education.
“Amidst formidable global economic challenges and the repercussions of dynamic shocks on African economies, ITUC-Africa emphasises the urgent need for a prompt restructuring of public debt in African economies, including Zambia.
“This strategic approach is vital to safeguard African citizens’, families, and communities’ human rights and overall well-being.
While Zambia and other African economies have demonstrated some forms of resilience to cope with and navigate a complex post-COVID recovery, contending with the challenges posed by tightening global financial conditions, geopolitical tensions, and ongoing climatic threats, concerns persist regarding the potential impact of debt distress on people’s socioeconomic rights.
Despite growth challenges, there is optimism that Africa’s resilience will improve, underlined by the projected rebound in growth to 4.3% in 2024. However, persistent risks such as debt distress, inflation, and climate change underscore the necessity for proactive measures. These challenges have contributed to debt default in some African economies, including Zambia, with indications that others may follow suit”.
On the call for action, the group further urges the IMF to consider reforms that prioritise human-centric fiscal management, aiming at mitigating the adverse effects of debt distress on workers and the general citizenry.
“ITUC-Africa calls for amicable debt servicing and repayment arrangements that do not compromise debtor countries’ abilities to address poverty and inequality, including exploring options for debt forgiveness”.
To the Zambian Government,
ITUC-Africa acknowledges the significant efforts made by the Zambian government, including the enactment of the Public Debt Management Act and the recent agreement with the Official Creditor Committee (OCC). However, the organisation recommends the establishment of a dedicated Public Debt Management Office.
This office would enhance oversight, transparency, and accountability, reinforcing the positive steps taken with enacting the Public Debt Management Act”