EGYPT - ICF 2022 & African Ministers Meeting

PANEL 4: DEBT FOR SUSTAINABLE INVESTMENT

Following the impact of the COVID19 pandemic and continued macro-economic instability linked to global events, 15 African countries are at risk of external and public debt distress, and 6 already facing debt distress. Despite these challenges, African countries have made significant strides to ensure the transparency of their operations on capital markets and also to provide reliable investment opportunities. As such official debt for sustainable investment swaps swaps are primarily aimed as a tool to generate additional investment and liquidity for climate resilience, rather than a tool for restructuring. Channeling new financial resources into climate resilience can be achieved by addressing the high cost of some of the existing debt of African countries and refinancing it on more affordable terms, with key performance indicators.  The meeting will explore performance-linked sovereign debt refinancing to channel investment that contributes to  supporting ambitious action on climate and nature as well as other aspects of sustainability, given the urgent need to address food, energy, and water security and making sovereign debt markets responsive to climate change and nature restoration.  Examples of debt swaps will be considered, while opportunities to link debt restructuring and new financing in th blue economy will be examined in the context of Africa’s Great Blue Wall Initiative.