The debt situation in many low-income countries (LICs) following the COVID-19 pandemic has deteriorated considerably. While many LICs had participated in the G20’s Debt Service Suspension Initiative (DSSI) by April 2022, only three countries have taken part in the Common Framework for Debt Treatment beyond DSSI. To better operationalise the Common Framework, the G20 should incentivise private and public creditor participation including those of Non-Paris Club members. In addition, G20 members should encourage the application of the comparability of treatment clause and urge multilateral creditors to participate in the debt restructuring process. The G20 should encourage full disclosure of debt among creditors by promoting the OECD Debt Transparency Initiative and by adopting the G20 Operational Guidelines. Moreover, the G20 should support local capacity building for public financial management in LICs and should promote that debt treatment under the Common Framework is subject to scaling up sustainable investments in debtor countries. Finally, the G20 should use its weight in the managing boards of the international financial institutions to push IMF-WB debt sustainability analyses to better include sustainability criteria.

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The pandemic has taken a heavy toll on the global economy. The sources of economic growth and productivity gains have been constrained, and poverty and inequality have risen sharply. In addition, fiscal space has been severely educed and public debt levels have risen at an unprecedented speed. To accelerate the recovery from COVID-19 and make it more sustainable, it is urgent to reconsider debt-restructuring strategies.

This policy brief describes the pitfalls in current approaches to debt restructuring for assessing sustainability in low and lower-middle income countries, proposes a reframing of debt sustainability analysis to take into account social and environmental sustainability and provides concrete examples of initiatives based on the experiences and challenges of the developing world.

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Data governance frameworks, structures and implementation approaches are all institutionally driven. Building an African data economy that benefits citizens and businesses requires the existence of responsible, sustainable and robust data governance institutions. From institutions that create or make relevant national and international data governance laws, regulations, standards and policies, institutions that monitor compliance and enforcement to available laws and regulations, institutions that generate evidence-based research to inform and maintain data governance mechanisms, institutions that apply data governance frameworks to their data processing pipelines to institutions that facilitate findable, accessible, interoperable and reusable (FAIR) data principles, data governance institutions define and shape data ecosystems. In Africa, there is a dearth of literature on these data governance institutions. This is mainly because robust data governance ecosystems are lacking.

This article was Written by Damian O. Eke

This policy insight synthesises the findings of six sub-Saharan African country case studies, analysing their government policy responses to the trade and employment shocks prompted by the COVID-19 pandemic. Vulnerability to the shock was most pronounced in the wealthier, more open, diversified and formalised economies (South Africa and Senegal); in Nigeria, where trade and government balances are very sensitive to oil price fluctuations; and in Uganda, which reacted with a strict domestic lockdown.

By contrast, growth decelerated only marginally in Benin and Tanzania, where government reactions were minimal or delayed. The capacity to offer a counter fiscal stimulus, liquidity support through loan guarantees and concessional debt, and an accommodative monetary policy depends on the income status of the economy, depth of financial markets, size of the government sector, and access to global development finance channels.

South Africa and Senegal were able to put into effect the most substantive stimulus packages, while Nigeria was constrained by having the smallest and most volatile tax base and a high bank liquidity profile. Save for Benin and Uganda, which devoted half their stimulus package to health spending, most countries concentrated on industry support and tax relief. Here South Africa was an outlier, instead using 60% of its package for unemployment and social security benefits owing to a sharp rise in unemployment and food stress.

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African indigenous businesses (AIBs) are in the nascent stages of becoming data-driven and innovative through data analytics. The data-driven agenda looks promising in industries like manufacturing (distribution), health, agriculture, and online platforms like social media, with enterprises deriving economic and symbolic value from descriptive, diagnostic, and predictive analytics. These data-driven activities tend to be often directly or indirectly enabled by the quest of multinational companies, who as business partners or collaborators of AIBs seek to mutually maximise value-generating activities. Thus, these multinational companies play a key role in creating awareness of the value of data and providing the motivation, and sometimes the technical and human resources, to enable AIBs to develop data analytics capabilities.

Concerning constraints, there is generally a lack of awareness regarding the value of data. AIBs are challenged in providing auxiliary resources and processes for a data-driven agenda (i.e., recruiting the right skillsets, acquiring logistics, paying for software licenses, and meeting regulatory standards, among others). Further, some are yet to scale above existing digitalisation barriers.

This brief was authored by Richard Boateng, Adedeji Adeniran, and Sone Osakwe