Africa faces financing gap of $1.3 trillion every year to meet its SDGs by 2030 – ECA chief

Addis Ababa, November 18, 2024 (FBC) – Ms. Semereta Sewasew, the State Minister of Finance of Ethiopia, has officially opened the Regional Consultation for the Fourth International Conference on Financing for Development (FfD) in Africa, following the welcoming remarks by Mr. Claver Gatete, Excutive Secretary and Under Secretary General.

Organised by the UN Economic Commission for Africa (ECA), the consultation serves as a crucial event for African stakeholders to come together, align their views, and craft a unified African voice on critical issues related to financing development on the continent.

In her remarks, the State Minister mentioned that Africa faces unique challenges that require tailored solutions to bridge the financing gaps, which include breaking the cycle of excessive debt service and ensuring sustainable debt management, addressing systemic issues causing macroeconomic imbalances, harnessing innovative climate financing mechanisms to support Africa’s urgent needs for mitigation, adaptation, and resilience building.

Semereta has also highlighted the importance of international cooperation to collectively tackle the regional challenges through Official Development Assistance (ODA) while African countries should enhance their Domestic Resource Mobilization (DRM) capacity to take full ownership of their development agenda.

She also highlighted the ongoing transformative efforts of Ethiopia to increase DRM through tax reforms, strengthen the public-private partnership model, and operationalise the Securities Exchange.

Meanwhile, Executive Secretary of ECA Mr. Claver Gatete noted that Africa faces a financing gap of 1.3 trillion USD every year to meet its sustainable development goals by 2030, which requires a unified response. In this regard, the consultation emphasised that a collective voice for Africa to deal with debt, improved public finance management, domestic resource mobilization, more concessional loans, climate finance, and private sector and MSMEs development are among the major steps to bridge the financing deficit.

In addition, improving public financial management and prioritising investments in infrastructure, energy, transport and human capital have also been raised as crucial responses to the growing financing gaps, he underscored.