G7 Backs President Ruto On Reform Of International Financial Architecture

The G7 summit has responded positively to President William Ruto’s call for increased support for Africa’s development. During the summit in Italy, President Ruto urged the G7 leaders to champion the reform of the international financial architecture to foster equity and inclusion.

He said the reforms would provide the Global South, particularly Africa, with access to concessional, long-term and agile finance, and also enhance the developing countries’ participation in decision-making. On its part, the G7 has committed to modernising the international financial architecture and enable it to meet contemporary global challenges.

As part of their resolutions, the G7 pledged to support initiatives such as the G20 Compact with Africa and the Paris Pact for People and Planet (4P). These initiatives aim to improve collaboration among global stakeholders and increase financing for development, climate solutions and private sector investment.

The G7 leaders also called on the international community to enhance sustainable and transparent financing for developing countries committed to substantial reforms and private investment. They emphasised the importance of domestic resource mobilisation as detailed in the Nairobi-Washington Initiative started by Presidents Ruto and Joe Biden when the Kenyan leader was on a State Visit to the US last month.

The leaders have promised to work with various stakeholders to provide coordinated support from multilateral development banks, facilitate favourable private finance and encourage private sector involvement to ensure that multilateral support effectively benefits developing countries.

They committed to collaborate with the International MonetaryFund, the World Bank and other crucial institutions to advance this plan, pilot it in various countries by the end of 2024 and eventually implement it. Moreover, the G7 has pledged to increase support for African nations striving for sustainable development, democratic governance, global stability, prosperity and adhering to the United Nations Charter.

The G7 plans to align its efforts with the African Union Agenda 2063 and the specific needs and priorities of African countries, including enhanced local and regional food security, infrastructure, trade and agricultural productivity. The group also supports the operationalisation of the African Continental Free Trade Area which, the members believe, will be crucial for Africa’s growth in the coming decade. They aim to bolster mutually beneficial and equitable cooperation with African nations and regional organisations, improve the management of local resources and promote increased private investment.

Endorsing the call from African countries for a greater voice in international forums, the G7 welcomed the African Union’s participation in the G20 as a permanent member and supported the creation of a third chair for Sub-Saharan Africa on the IMF Executive Board this November.

The G7 reiterated its support for the G20 Compact with Africa, which aims to boost private sector investment, promote structural reforms, support local entrepreneurship, and enhance energy sector cooperation.

The G7 Partnership for Global Infrastructure and Investment, including initiatives like the EU Global Gateway, provides a framework to promote a vision of sustainable, resilient and economically viable infrastructure in Africa, featuring transparent project selection, procurement and finance.

The G7 reaffirmed its unwavering commitment to the 2030 Agenda for Sustainable Development, pledging to double efforts to accelerate progress towards the Sustainable Development Goals. Their goal is to achieve long-term sustainable development, uphold strong environmental, social and governance standards, and foster shared prosperity globally.