- Ruto said that to help the countries in debt distress, there should be a longer tenure of their sovereign debts.
- He said there should be a grace period of between five to ten years to give them a breather from their debts.
President William Ruto has said Africa needs to be treated fairly when seeking loans in the international space.
Speaking on Thursday in New York during the United Nations General Assembly, Ruto said Africa ought to be given fair treatment and not to be given favourable conditions.
"We do not want favourable treatment, we want fair treatment. If others are paying 2 per cent, let us pay 2 per cent. We should not be paying 14 per cent. I think it is just fair," he said.
Ruto said countries in debt distress need to be bailed out if they are to bring development to their people and promote Climate Action.
"Secretary General of the UN said yesterday there are 52 countries representing 3.4 billion people are either high risk or moderate risk in debt distress. We need to pull back these countries, we need a mechanism that pulls back these countries," the Head of State said.
Ruto said that to help the countries in debt distress, there should be a longer tenure of their sovereign debts.
He said there should be a grace period of between five to ten years to give them a breather from their debts.
Further, Ruto said liquidity challenges ought to be addressed.
He said it is time for nations to leverage the balance sheets of the multilateral development banks to create additional concessional resources like the Special Drawing Right.
"How do we go for another Special Drawing Right facility? We went for it during Covid, why can't we go it to deal with debt distress and to deal with Climate Action?" he posed.
The Special Drawing Right is an international reserve created by the International Monetary Fund to supplement the official reserves of its member countries.
The SDR is not a currency. It is simply a potential claim on the freely usable currencies of IMF members.
Additionally, Ruto said Africa faces challenges in the Financial market when trying to access resources for development.
He said the continent ends up paying almost eight times more in the Financial market.
This, he blamed on rating agencies in the Financial market, the risk analysis, and sovereign debt framework which he said are not fair to Africa.
"These rating agencies assign very high risk to our continent. What we end up doing is that we pay interest more than others. And that is the reason today, out of the 10 countries in debt distress, six are from Africa," the Head of State said.
"All of them are in the developing world because if you are paying eight times more, you are set up for distress from the beginning."
Ruto said the rating agencies and the risk analysis framework in the Financial market must be reformed.
"The reason we ended up in a financial crisis in 2007 is because of the same rating agencies. They were wrong back then, and I bet they are wrong today about us," Ruto said.