On June 22 and 23, France will host a “summit for a new global financial pact” which will deal with the reform of multilateral development banks, the debt crisis, the financing of green technologies, new international tax tools and financing and special drawing rights.
“There is a need for us to act collectively and rethink the international funding structure,” an official from the French presidency said, adding that Paris was pressing its G7 partners ahead of next month’s conference, according to Reuters.
“Today, we have a network of development banks around the world that finance international solidarity, and find their capacity to work limited,” he added.
The COVID-19 pandemic pushed many poor countries into debt as they needed to continue to meet their obligations despite the massive shock to their finances.
“Africa is heavily in debt and we are paying the price for the crises that followed, including now Ukraine, so the G7 has a responsibility,” a French official said.
Instead of dealing with Africa’s debt country by country, the official said there was a need to find a systematic way to deal with it.
Africa’s debt problems add to the inability of some of the world’s poorest countries to adapt to the green transition, while struggling to fund a response to the climate crisis as they suffer of its impact.
Rich countries have yet to deliver on the climate finance pledge they made as part of an earlier pledge to raise $100 billion a year, a major stumbling block in global climate negotiations.
Paris hopes to agree in June on a roadmap for the next 18 to 24 months with a unification of efforts throughout 2023 at the G20 leaders’ summit in India, the general meetings of the World Bank and the International Monetary Fund. and the COP28 climate change summit in the UAE.
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