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School of Law

Moratorium on debt for Africa? Be careful of unintended consequences

In a piece for The Conversation, Professor Rodrigo Olivares-Caminal argues that a blanket moratorium on debt for Africa risks costing African countries much of the hard won gains many have achieved over the past 15 years

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Africa is home to 41 of the International Monetary Fund's 59 Low Income Countries, writes Rodrigo Olivares-Caminal, Professor of Banking and Finance Law at Queen Mary University of London, in this article for The Conversation. These are more structurally vulnerable to external shocks such as Covid-19. The pandemic is affecting economies as governments implement increasingly aggressive lockdown procedures to stem the rate of the spread of the virus. It is also taking a toll on key commodity sectors and tourism, which are significant revenue earners for many countries across the region. The economic impact of Covid-19 has sparked calls from various stakeholders for a blanket moratorium on all debt service due to African creditors. If the debt suspension initiative is applied as a general blanket solution, it risks costing African countries much of the hard won gains many have achieved over the past 15 years.

Read Professor Olivares-Caminal's full piece on The Conversation website.

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