Africa-Press – Kenya. President William Ruto has called for urgent and effective debt restructuring and refinancing for Africa’s most distressed economies.
He warned that without decisive action, the continent’s commitments to climate and development finance will remain “aspirational.”
Speaking during the second Africa Climate Summit in Addis Ababa, Ruto emphasised that meaningful financial reform is indispensable if African nations are to address both climate change and development goals simultaneously.
“Without debt restructuring, Africa’s shared commitment to climate and development finance will remain aspirational,” he said.
Ruto underscored the need to overhaul the current approach under the International Monetary Fund (IMF)’s Common Framework, calling it inadequate in its current form.
“Restructuring must be fair, timely, and effective. The IMF’s Common Framework must be reformed to deliver real relief—not merely more process,” he stated.
Citing data from across the continent, the President revealed that at least 21 African countries are either in or at high risk of debt distress, with debt service consuming an average of 13.5 per cent of government spending.
This, he warned, outpaces public spending on essential services like health and education, undermining the very social fabric that climate action depends upon.
“Many of these countries have lost market access, unable to secure new capital or refinance at sustainable rates and tenors,” Ruto lamented. “These macroeconomic realities directly undermine climate and development action.”
The President recalled that financial reform was a central theme of the inaugural Africa Climate Summit held in Nairobi in 2023.
While acknowledging progress in global discourse, he criticised the lack of tangible outcomes.
“Despite progress in the debate, we have not seen meaningful change in practice,” he said.
Highlighting the importance of replenishing concessional financing mechanisms, Ruto stressed that institutions such as the International Development Association (IDA) and the African Development Fund (ADF) remain lifelines for developing countries.
“Unless replenished at scale, development finance will remain severely constrained,” he warned.
Ruto applauded the African Development Bank’s $750 million issuance in hybrid capital over the past two years, but noted that such efforts, while commendable, are insufficient compared to the scale of the challenge facing the continent.
He also pointed to the central role of Multilateral Development Banks (MDBs) and the IMF in the future of global climate finance.
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