Thematic Focus Area 2- Debt Management
Strategic Objective 1: Improved government transparency and accountability on public debt borrowing
The evidence gathered by AFRODAD over the years shows increased sovereign borrowings by the majority of SSA member countries. Borrowed resources should be used to fund poverty reduction and economic growth initiatives. Persistent budget deficits, lack of adequate funds for infrastructure development and the need to develop domestic financial markets among others are some of the factors that are continuing to put pressure on African governments to borrow both externally and internally. Consequently, regardless of such initiatives as the HIPC and MDRI which helped to reduce the debt burdens of some of the highly indebted countries external debt has been on the rise.
Since the development and publication of AFRODAD Borrowing Charter (2011) - principles and guidelines on sovereign financial borrowing, successful lobby and advocacy campaigns have been embarked upon. The Charter provides principles and guidelines that should guide and inform sovereign borrowing with the aim to contribute to the improvement of current weak administrative, institutional and legal processes for loan contraction and public debt management. AFRODAD will continue to lobby borrowing countries especially those in Sub-Saharan Africa to adapt the principles and guidelines, so as to ensure efficient and effective use of debt resources to prevent recurrence of the debt crisis and make governments accountable to their citizens.
AFRODAD will advocate to governments to ensure that fiscal, trade and general macroeconomic policies are designed to promote women’s economic empowerment and that they do not cause adverse gender impacts. It also emphasises that women should be actively involved in the development of macroeconomic policies, programmes and implementation strategies (SDG strategies, trade agreements and national budgets) and calls for gender analysis and gender equality provisions to be integrated into all PRSPs and other poverty reduction strategies. Gender mainstreaming is required with respect to all public expenditure, and gender-responsive budgeting offers a practical application of this that can make best use of limited resources and improve the effectiveness of fiscal policies.
Without gender analysis of the distribution of adjustment costs and benefits – both social and economic – between debtors, creditors and investors, women’s increased unpaid work, the deterioration in their health and the decline in their capabilities remain invisible, which is likely to give a false impression of the effectiveness of policy and development strategies. Both human rights standards and economic efficiency arguments call for gender equality and women’s empowerment. Without gender mainstreaming, there is little chance that efforts to reduce and manage external debt will bring about substantial poverty reduction and improve the lives of both women and men.