NGN 2024 survey section 2 key findings: assessing resources from non-African partners

The Mo Ibrahim Foundation’s theme for 2024 is Financing Africa. To inform the upcoming research report on the theme, in February-March 2024, MIF surveyed almost 100 respondents from 54 African countries, all members of the Foundation’s Now Generation Network (NGN).

The findings of the survey will be unveiled in a three-part webinar series. The first, on 5 April, and available on demand here, focussed on Assessing Africa’s financial resources. This second part is dedicated to Assessing Resources from non-African partners.

In summary, Africa’s youth call for a more inclusive global financial architecture, a more sustainable approach to debt finance and reduced government expenditure in regard to resources from non-African partners.

A divided stance on borrowing: half of Africa’s youth are in support of countries borrowing while half are against it

Respondents were asked if African countries should borrow more funds to achieve global development goals.

• Almost half of respondents (47.4%) selected options in support of borrowing, with 44.3% conditioning it on financial sustainability and 3.1% quoting the need for faster progress.
• Collectively, the other half of respondents (49.5%) were against borrowing. 28.9% advocated for Africa to use its own resources, while 20.6% cited Africa’s already substantial debt burden.
• A minor share of respondents (3.1%) considered the need for better financial resource management and accountability systems as alternative options to borrowing.

Should African countries borrow more funds to achieve global development goals?

“Borrowing can be useful only if African countries utilise the funds for intended purposes, assess and manage borrowing risks effectively, and complement borrowing with sound macroeconomic policies. If not, borrowing will lead to increased debt burden.” ~NGN member

Almost 60% of Africa’s youth believe countries should reduce government expenditure to address the debt servicing costs

Respondents were asked what African countries should do to address the high debt servicing costs. (multiple answer question)

• Reducing government expenditure was the most selected option by more than half of respondents (59.8%)
• A notably high share of respondents (48.5%) called for increased concessional finance for African countries (lower interest rates, longer repayment periods, etc).
• About one third (30.9%) of respondents were in favour of total debt cancellation.
• Increased foreign aid was the least desired solution to debt servicing, selected by only 5.2% of respondents.
• Respondents also pointed out the need to tackle Illicit financial flows from the continent to leverage more resources for debt repayment.

How should African countries combat the debt servicing problem?

Africa’s youth are calling for a more inclusive global financial architecture with greater African representation

Respondents were asked how the current global financial architecture can function better for African countries. (multiple answer question)

• Unitedly, all respondents (100.0%) selected the need for more inclusivity in the global financial architecture.
  • 51.5% of respondents argued for Greater voting shares for African countries in multilateral institutions and 48.5% of respondents advocated for Inclusive reform of the Global taxation system.
• 38.1% of respondents called for fairer credit ratings from the main credit rating agencies (CRAs) and 37.1% recommended alternative multilateral financial organisations e.g. BRICS etc.
• The least selected option - only 22.7% of respondents - was increased Special Drawing Rights (SDR) allocation.

How can the current global financial architecture function better for African countries?