President William Ruto has continued to forge a coalition of international partners in his quest to reform Multilateral Development Banks.
The president on Tuesday secured the support of Italian President Sergio Mattarella, Italian Prime Minister Giorgia Meloni and the European Union (EU) Council President Charles Michael on the sidelines of the Italy- Africa Summit where the Head of State narrowed down on three reform proposals which he believes will allow the financial institutions to cater to all nations equitably.
According to State House spokesperson Hussein Mohammed, the lobbying is timely since Kenya is slated to host the International Development Association-IDA21 meeting in April 2024.
The reforms in question include;
Redesigning the International Development Association(IDA) Deployment
The reform seeks to prioritise borrowers' needs over existing agendas as set by the donor countries.
This will further create a partnership between the nations borrowing and the lenders, as opposed to the idea of patronage that currently exists.
President Ruto speaking during the 2023 Mo Ibrahim Governance Forum held at Kenyatta International Convention Centre in Nairobi last year, advocated for Africa as a promising investment spot that promises a high return.
“We are asking for a win-win financial architecture that brings everyone on board,” he stated at the time.
Representation in Decision-Making
To ensure beneficiaries have a say in the final decisions made regarding borrowing, President Ruto is of the view that the countries in question need to be involved in the processes that create policies governing financial institutions.
President Ruto has in the past complained that third-world countries are not given an equal seat at global meetings, proposing for the Africa Union attend group meetings on behalf of Africa.
Advocating for Increased Concessional Funding
To enable beneficiary nations to avoid exploitation by predatory lenders with higher interest rates, this reform seeks to increase available concessional loans and provide the borrowers with better rates than the market value.
Speaking during the Africa Climate Summit held in September 2023, Ruto asked multilateral banks to consider reviewing interest rates for loans lent to African countries.
“This continent has a very high potential; we are limited by high-interest rates, and many of the countries are already in debt distress,” he noted.
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