The Executive Secretary of the United Nations Economic Commission for Africa (ECA), Claver Gatete, labeled the current global financial architecture as “outdated, inequitable and unjust.”
Gatete made the remark at the 46th Ordinary Session of the Executive Council of the African Union (AU) kicked off Wednesday in Addis Ababa under the theme: “Justice for Africans and People of African Descent Through Reparations.”
He said a just world requires governance reforms in international financial institutions to ensure that Africa has a stronger voice in shaping global economic policies.
“The transatlantic slave trade and colonial exploitation robbed Africa of its people, resources and dignity, and left behind inequalities that persist in global financial systems, trade structures and governance institutions, till this day,” he said.
The executive secretary also called for debt restructuring that allows African nations to invest in their people and development instead of paying exorbitant interest rates
The extraction of Africa’s resources without corresponding development, the undervaluation of African economies in global credit assessments, and the systemic barriers to trade and investment are, indeed, contemporary manifestations of these historical injustices, he elaborated.
Stating that Africa’s current global financial standing reveals the stark inequalities it faces, Gatete pointed out.
He said the continent possesses 30 percent of the world’s mineral reserves, including 40 percent of its gold and up to 90 percent of its Chromium and Platinum yet Africa accounts for less than 3 percent of global trade and only 1 percent of global manufacturing output.
The executive secretary noted that the injustice extends to Africa’s credit ratings, which are dominated by external agencies that sometimes apply unfair and subjective assessments to African economies.
“As we speak, only two African countries – Botswana and Mauritius – hold investment-grade ratings, while others, despite sound economic fundamentals, are burdened with high-risk labels,” Gatete said.
According to the executive secretary, this situation inflates borrowing costs, stifles investment and keeps African economies locked in debt cycles.
“It is therefore crucial that these, beyond financial compensation, must be addressed as part of the continent’s conversation on reparative justice,” the executive secretary stated.
MG/as/APA