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Africa & Imperialism

African nations sitting on debt volcano

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debt African Nations

African nations sitting on debt volcano

Africa’s public debt has doubled to nearly half of Africa’s economic output since 2008.

The IMF warned before the coronavirus pandemic in December 2019 that high commodity prices and low demand has forced many African nations to borrow as they did in the 90s. But some will struggle to pay back. 20 of the 54 countries in Africa are near distressed levels or already there, according to the IMF.

Up until 2018, African Nations raised $56 billion in debt. China alone has handed $143 billion to the continent between 2000-2017, raising fears of a new “debt trap imperialism”.

Africa’s debt payment was about 13% of total government revenue before the coronavirus and just 4.7% by 2010.

Meanwhile, Nigeria allocates over 60% of its budget to debt servicing in 2019.

The Head of United Nations Economic Commission For Africa, Vera Songwe says, “ Our leaders have two choices, you either pay obligations to the bondholders or you buy medicine, food, and fuel for the population”.

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This has led to debt freezing for African Nations, thanks to the Paris Club, the debt freezing aims to free up cashflow. 25 African Finance Ministers wrote a letter to global economic leaders in April asking for delays in $44 billion worth of debt payments. The Paris Club proposed an eight-month suspension of debt payments valued at $11 billion.

The Coronavirus has created major setbacks for the global economy as the World Bank expects global economic output to shrink by 5.2% in 2020. Expanding debts in Africa with reduced Economic output to pay for it cannot be ignored.

A series of debt defaults will return Africa to the era of the 90s when poverty was rampant and nations defaulted on debt.

About 29 million Africans are expected to join the already 400 million Africans living in extreme poverty, of which over 80 million of those are in Nigeria.

In 2005, rich nations led by the Paris Club wrote off $100 billion in loans owed by African nations, which was accumulated since the 1960s when newly formed African nations spent heavily on infrastructure and subsidies aiming to create national identified and modernize their nations.

Some critics believe debt suspension for African nations just postpones the trouble, not solve it. Some countries in Africa did not sign the new debt freezing deals fearing it may affect their credit ratings if they don’t pay on time.

The “elephant in the room” is China. China’s loans to Africa has surpassed the IMF’s and the World Bank’s. Almost 20% of Africa’s entire external debts comes from China. China usually demands collateral in the form of state assets in place of debts relief which leaves African nations without much leverage.

While the West has the leverage of Quantitative Easing to support failing economies during the COVID-19 pandemic, Africa doesn’t. Ghana Minister of Finance, Ken Ofori seeks 3-year suspensions for Africa.

The African debt problem needs an economic output answer, the easiest way to solve that is for African Nations to expand GDP through trade. However, the African Free Trade Agreement has been suspended due to coronavirus.

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Africa & Imperialism

Addressing The Surge Of Cultural Imperialism In Nigeria – Patricia Soni-odoh

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Cultural imperialism in Nigeria

Cultural Imperialism In Nigeria – NCBN

Born into an already existing culture and traditions, individuals learn and passes these culture and traditions from one generation to another.

It is visible that the Nigerian people value and cherish these passed down cultures and traditions but in recent times, this has been threatened by the menace called “Cultural Imperialism”.

What is Cultural Imperialism?

Cultural imperialism is the process and practice of promoting a foreign culture over another. It is the influence of one nation’s culture over others.  With the exportation of cultural representations like Music, Movies and Dressing etc, Cultural imperialism has been made rampant. The blame should partially be on the countries media.

One of the major roles of a countries media is to promote the culture of its people. Nigerian media has not truly done its part in ensuring this. Instead it promotes other culture by saturating its contents with foreign programs. Social media has made it easier to access and adapt to foreign culture and traditions; thereby forgetting ours.

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Not to say that learning from other culture is bad but we must do this with a sense of consciousness and for a developing country like Nigeria where there is a sense of community embedded in every one of us, it is important that we do not lose our culture and norms because whether we like it or not, our culture is what showcases us to the world.

The Nigerian media must remember to always to make it a duty to promote its indigenous cultural, moral and value systems while being unbiased because at the end of the day, no one can keep our culture and traditions alive like us.

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Africa & Imperialism

Ecobank Transnational CEO Warns That Debt Cancellation Will Hurt African Countries

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Ade Ayeyemi debt cancellation

Ecobank Transnational CEO Warns That Debt Cancellation Will Hurt African Countries

The Group Managing Director and Chief Executive Officer of the Pan African Banking Group, Ecobank Transnational Incorporated, Ade Ayeyemi, has warned against the idea of African countries seeking debt cancellation from multilateral institutions, bilateral lenders, and international financial organizations.

Ade Ayeyemi stated this during an interview at the Bloomberg Invest Global virtual conference on Monday, July 22, 2020.

The bank CEO stated that canceling the debt of heavily indebted African countries would only come back to haunt them.

According to Ayeyemi, “Forgiveness is not helpful because your debt is somebody else’s savings. When you go to the market to borrow money, the market is looking at your current and past behavior.”

This view was also corroborated by the Chief Executive Officer of Kenya’s largest bank, Equity Group Holdings, James Mwangi, when he said that forgiveness was a form of default, which distorted markets. He pointed out that the call for debt forgiveness was one area where the continent should be conscious of the unintended consequences.

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It can be recalled that in April, African Finance ministers asked for debt relief from multilateral Institutions like the International Monetary Fund, World Bank and the European Union amid the coronavirus crisis.

The African countries who asked for immediate relief from debt service obligations from these multilateral institutions including the G20, canvassed for a portion of their debt to be forgiven or converted into long term, low interest loans. This is to help free up funds for the more than 50 poor African countries to deal with the coronavirus pandemic.

Source had reported last week, the plans by China, to exempt some African countries from repaying their interest-free loans that are due at the end of 2020. It also expressed its willingness to provide further support, including loan maturing extensions, to free up funds needed to deal with the pandemic.

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#COVID19NIGERIA Situation Report

The #COVID19Nigeria situation report for 21st July, 2020 has been published. Our daily reports provide a summary of the epidemiological situation & response activities in Nigeria

The #COVID19Nigeria situation report for 21st July, 2020 has been published. Our daily reports provide a summary of the epidemiological situation & response activities in Nigeria

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The African Union and Africa CDC will virtually rollout the Partnership to Accelerate COVID-19 Testing (PACT) in Africa tomorrow 4 June, 2020 at 11.00 am Eastern Africa Time.

The African Union and Africa CDC will virtually rollout the Partnership to Accelerate COVID-19 Testing (PACT) in Africa tomorrow 4 June, 2020 at 11.00 am Eastern Africa Time.

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