This has been a week of revealing contrasts, so revealing that a screenwriter might find them a bit on the nose.
Most prominent was the global attention focused on the underwater fate of a small group of rich people and the general indifference to the near-simultaneous drowning of a large group of poor people.
In the same spirit of saying the quiet part out loud, here are three quotes from senior IMF officials, extracted from their usual vac-pack of mind-numbing boilerplate. (As those grumpy old Marxists Horkheimer & Adorno wrote many years ago: “Anyone who underestimates the power of boredom is a fool.”)
First, Kristalina Georgieva, the Managing Director of the IMF, at the Summit for a New Global Financing Pact: “We have youth in some places and capital in different places.”
Second, Catherine Patillo, Deputy Director of the IMF’s Africa Division: “Sovereign spreads for sub-Saharan African countries have tripled relative to the emerging market average [since] the beginning of the global tightening cycle.”
In other words, the difference between what Africa pays for bonds and what AAA-rated rich countries pay has jumped since the start of the pandemic, even in comparison with the rest of the developing world. Keep in mind – it’s not like the pre-pandemic world treated Africa particularly fairly either. So this is bad-to-worse in the clearest possible way.
It also adds context to the Ugandan climate activist Vanessa Nakate’s criticism in Paris of the fossil fuel industry’s dalliance with African governments at a moment when oil revenues are sky-high and the continent’s financing options have shriveled: “It seems there is plenty of money, so please do not tell us that we have to accept toxic air and barren fields and poisoned water so that we can have development.”
The news that the Chinese-led Asian Infrastructure Investment Bank has issued its first green bond to Egypt is a rare exception to that trend, and it’ll be interesting to see how this week’s rhetoric in favor of remaking climate-development financing will play out.
But quote number three (again from Patillo) shows financing isn’t the only issue: “Climate funds have received far more funding than they have disbursed, and sub-Saharan Africa is under-represented in terms of spending on them.”
In other words, one of the biggest barriers to young Africans achieving a green transition is the old Africans ruling them.
My own country, South Africa, is exhibit A. President Cyril Ramaphosa, of course, rushed to Paris for his summit photo-op with Emmanuel Macron. This despite having presided over an environmental basket case of a country that can’t keep the lights on, even as it managed to combine being 14th highest in global per capita emissions with only being number 31 in economic size.
South Africa has agreed on a huge green transition deal with the G7 and China is now jumping in with its own offers of energy equipment. Yet every winter evening in Johannesburg reeks of coal smoke and diesel fumes from generators. Meanwhile, Ramaphosa’s own Mineral Resources and Energy Minister is actively campaigning against the overhauling of highly polluting coal-fired power plants.
As grim old Afrikaner uncles used to say when I was a kid: “We’ll see what we’ll see.”
