President William Ruto has urged urgent debt restructuring for Africa’s most distressed economies. He warned that without action, the continent’s climate and development goals will remain out of reach.
Speaking at the second Africa Climate Summit in Addis Ababa, Ruto said financial reform is essential. “Without debt restructuring, Africa’s shared commitment to climate and development finance will remain aspirational,” he said.
IMF Framework Needs Reform
Ruto criticized the International Monetary Fund (IMF) Common Framework. He called it inadequate in its current form. “Restructuring must be fair, timely, and effective. The IMF’s Common Framework must be reformed to deliver real relief—not merely more process,” he said.
Debt Pressures Threaten Development
Ruto revealed that 21 African countries are in or at high risk of debt distress. On average, 13.5% of government spending goes to debt service.
This is higher than spending on health and education. “Many countries have lost market access, unable to secure new capital or refinance at sustainable rates and tenors,” he warned.
Financing Mechanisms Are Vital
The President stressed the need to replenish concessional financing mechanisms. Institutions like the International Development Association (IDA) and the African Development Fund (ADF) are crucial for developing nations.
He praised the African Development Bank’s $750 million hybrid capital issuance over the past two years but noted it is not enough to meet Africa’s financial challenges.
MDBs and IMF Must Play a Role
Ruto highlighted the central role of Multilateral Development Banks (MDBs) and the IMF in climate and development finance. Bold, effective reforms are needed to ensure African countries can act on climate commitments and achieve sustainable development.
Ruto’s call is a reminder that without urgent financial reform, Africa risks falling behind in global climate action and development progress.
