G-20 Negotiators Back South Africa’s Push to Tackle Continent’s Debt

South Africa Sets G-20 Agenda: Focus on African Debt and Climate Action

(Bloomberg) — At the start of South Africa’s G-20 presidency, negotiators known as sherpas have signaled strong support for addressing pressing global challenges, particularly high debt levels in African nations and climate change financing.

The second day of sherpa meetings in November marked the official handover from Brazil to South Africa. During the meetings, South Africa’s G-20 sherpa and director general at the department of foreign affairs, Zane Dangor, emphasized the focus on debt sustainability.

Tackling Africa’s Debt Crisis

“There’s going to be a “focus on ensuring that debt sustainability for low-income countries is addressed,” including the setting up of a cost of capital commission, Zane Dangor said. “We had significant discussions around the cost of capital commission, and we had strong support from all quarters, not just from the developing countries, or from the African Union, in fact from everybody.”

South Africa is pushing for a cost of capital commission to address debt disparities faced by developing countries, closely aligned with its call for a review of the G-20’s Common Framework. The framework, introduced in 2020, aims to assist debt-ridden countries but has been criticized for being slow and politically complex.

Africa’s external debt has surged to over $650 billion, with debt servicing costs projected to reach nearly $90 billion in 2024, according to the United Nations.

Prioritizing Climate Action

Another key priority for South Africa is securing increased climate change financing.

“The working groups will look at issues such as strengthening disaster resilience and response, based on the fact that climate change is with us and the damage arising from climate change,” Dangor said. “There’s been specific priority of mobilizing finance for the just energy transition.”