Are Special Drawing Rights on African Economies Sufficient? [Business Africa]
Africa needs $ 285 billion by 2025 to try to get its head above water. It comes as the continent’s economies struggle after being hit hard by the coronavirus pandemic.
Among the avenues discussed at the recently concluded Paris summit on the financing of the continent’s economies were the special drawing rights initiated by the International Monetary Fund (IMF) 52 years ago.
This ticket printing facility, used sparingly, gives member countries the ability to “draw” cash to supplement their financial reserves.
But this alternative is subject to the notion of quotas, which take into account the economic strength of each region of the world.
The principle aims to limit the debt ratio but it is considered by many as far from meeting Africa’s expectations. $ 33 billion is estimated for the continent, but leaders believe a minimum of $ 100 billion is needed.
Faced with this small amount, African heads of state expect a gesture from the richest economies. And in what could be a boost, French President Emmanuel Macron echoed calls for the Paris summit. “The shares of SDRs in Africa must be given as a sign of solidarity,” he said. And would appeals be heard? The continent is crossing its fingers.
Thomas Mélonio is the Executive Director in charge of research and innovation at the French Development Agency (AFD). He told Ignatius Annor of Business Africa: “At the end of the day, African economies have to be financed on their own, by mobilizing national revenues through taxes. There are of course a lot of Africans who have deposits, and that deposit has to be converted into an investment by the financial system. We therefore need the development of African financial systems so that Africa can finance its own development. ”
Ivory Coast: organic cocoa production
Cocoa prices in Côte d’Ivoire, the world’s largest producer of this crop, have fallen for the second year in a row and farmers are outraged.
But not in M’Brimbo, a village in central Côte d’Ivoire that 11 years ago became a test bed for organic cocoa cultivation.
The collective of local farmers sell their high quality products at double the market price for non-organic cocoa. Chocolate made from their cocoa is sold in French supermarkets under the “Grand Cru M’Brimbo” brand, and is in high demand.
“They are now making 200 … 280 tonnes approximately. This year, we will buy 200 tonnes from them. They have gone organic. They have very good quality cocoa which is internationally recognized,” said Arthur Gautier, agricultural engineer at Ethiquable.
Cocoa is the backbone of Côte d’Ivoire’s rise to power as one of West Africa’s major economies. Today, the country produces two million tonnes of cocoa per year, or more than 40% of the world market.
But the expansion also came at a dark price for the environment. Forests have been destroyed and in some places herbicides and pesticides have contaminated the soil.
Using pioneering techniques in Latin America, farmers in M’Brimbo manually weed their fields and have developed specific methods for drying and fermenting cocoa beans.
“When we started, we saw the importance of being able to grow organic and we saw what organic brought us. At the beginning I had a bicycle, today I can build (a house), I have a motorbike. There has been a change in my life. I was able to send my children to school properly. This means that organic farming is really a good thing, ” said Evariste Solo, producer and president of the Equitable Cooperative Society of Bandama (SCEB).
The cooperative produced 13 tonnes of cocoa with 33 farmers in 2010, and this year is expected to produce more than 200 tonnes, with 264 producers.
Ten other cooperatives in Côte d’Ivoire now produce organic cocoa and more are expected to follow suit.
Beninese woven loincloth
In Benin, entrepreneurship in the fashion and textile sector is booming. A renewed interest pushed in recent years to consume local production and the evolution of fashion tastes are believed to be at the origin of the boom.
In this context, the designer Elvira Akplogan decided to create her brand “Loan-H”. The Objective, bring a touch of modernity to Kanvo, the woven loincloth from Benin.
“People have now understood that woven fabric is a sought-after material, a workable material, and we are working to make our woven fabric, the ‘Loan-H’ woven fabric, more flexible, more manageable and easy to use in My large. The wish is that Benin has its own label because there is no point in having cotton at home and not producing fabric, ”said Elvira Akplogan, CEO of“ Loan-H ”.
And to achieve this result, the young woman will set up her own woven loincloth production unit. For each collection, at least 54 rolls of 25 meters of woven loincloth are produced, as well as 300 items of clothing each quarter. The buyers are die-hard loincloths and fashion professionals. Something that warms the hearts of fashion designers.
“After I finish the fabrics when I find them in ‘Loan-H’ stores, it gives me joy in my heart as I look at them and wonder if I was the one who brought them out with the ‘Loan-H’ help. So I have potentials and I didn’t know, “said Christian Adjehounou, weaker” Loan-H “leader.
If the craze around the Beninese woven loincloth is so great, the quantities produced remain too low to meet demand. This is due to the lack of a developed textile industry in the country.