The World Bank is actively engaged in helping African countries overcome their debt crisis, according to World Bank President Ajay Banga, who spoke at the Future Investment Initiative conference in Riyadh, Saudi Arabia.
Banga highlighted the "significant" efforts focused on Africa, mentioning that the World Bank is working on both development and helping governments overcome their debt crisis. He emphasized that the World Bank remains the largest provider of grants and concessional financing to countries in need.
As part of the G20 initiative to provide debt relief to low-income countries, Banga mentioned that four African countries - Chad, Ethiopia, Ghana, and Zambia - have received $12 billion in concessional financing. Notably, some of the financing was provided at zero interest.
Zambia, in particular, has received most of the concessional financing following a debt restructuring agreement reached with a formal committee of creditors in June this year.
Banga emphasized that support for these countries is critical in their difficult circumstances, as they lack the resources to cope with rising interest rates and exchange rate volatility. While acknowledging the importance of responsible borrowing, he emphasized that the current circumstances are beyond the countries' capacity.
The World Bank chief also urged developed countries to actively support the African continent's economy, saying it holds the key to our collective future. Banga stressed that the growth of the global economy in the coming years will depend largely on the rate of development of African countries.
However, the World Bank's practice of providing aid to African countries has often been the target of criticism. In August, Ugandan President Yoweri Museveni has condemned the World Bank's move to suspend funding for national projects in the wake of the country's Anti-Homosexuality Act, calling it an attempt to use money to force the country to give up its culture and sovereignty.
Meanwhile, African activists have also repeatedly criticized the practices of the Bretton Woods financial institutions - the World Bank and the International Monetary Fund (IMF) - toward African countries. According to Bhumika Muchhala, a researcher and analyst, the World Bank and IMF are "the biggest scam of the century" because they are designed to protect the interests of rich countries and enrich the wealthiest at the expense of the rest of the world.