A seat at the table of global leaders is better than none

Afortnight ago the leaders of the Group of Seven (G7), a club of rich nations representing 29% of world GDP, met in Hiroshima, Japanese Prime Minister Fumio Kishida’s home city.

Back in Pretoria, SA’s government looked on at this party, one it usually gets invited to. Such was the past respect for SA’s regional and global leadership that a seat at the world’s most powerful table was generally reserved for it.

Alas, Japan as host nation decided not to extend an invitation, reasoning that Pretoria no longer speaks for the continent. The gravity of this decision should not be lost on us. Japan was an ally against the apartheid government, banning Japanese private investment in SA as early as 1960.

In a 1995 meeting with then prime minister Tomiichi Murayama, a newly installed president Nelson Mandela spoke fondly of Japanese support for his fledgling democratic government. How far we have strayed.

This piece is not intended to lament the country’s not-so-neutral “neutral” stance on the Russia-Ukraine war and consequent diplomatic and economic fallout. SA is undoubtedly poorer in moral, security and economic terms as a result of the Union Buildings becoming an extension of the Kremlin.

Instead, this piece laments the missing SA voice, the one that advocates for itself and the continent when seated at the G7 table. In past meetings we have represented ourselves well. During the pandemic years SA lobbied hard at the G7 meeting in the UK (2021) for the group to plug Covid relief funding for African governments.

Two years and a war in Europe later, the continent is beset by a different contagion — debt. In the latest figures released by the IMF, about 17% of African government revenues go to servicing external debt, the highest share since 1999. Eight of the nine countries listed by the IMF as being in “debt-distress” are African.

The contagion has even resulted in Chinese hackers attempting for years to access Kenya’s government data, presumably in a bid to secure information to support Beijing’s repayment claims. Beijing denies any involvement.

Africa’s debt distress is hardly fair. African states attract higher interest rates as a consequence of their credit ratings, and perceptions that their markets are “risky”. This view has some basis in fact, but it is only partially true. The Mo Ibrahim Foundation, says Africa accounts for just 2% of global public debt in 2023.

The total debt stock owed to creditors by African governments equates to just under $2-trillion — less than the German government’s expenditure for 2023. When adjusted for GDP, African debt does not stand out as being uniquely high, with 48 of 54 countries having lower public debt-to-GDP ratios than the US.

However, the consequences of indebtedness are real — debt servicing chews up cash needed for schools and hospitals. As The Economist has noted, African governments are facing a damaging new age of austerity as a result. Kenya has already taken extraordinary measures to meet its debt repayments, including the suspension of salaries for government officials. Tightening purse strings, climate change and a demographic boom will place governments under serious pressure to deliver. If they do not, unrest will surely follow.

Back to the G7: had SA’s foreign policy been truly neutral, President Cyril Ramaphosa would surely have been in Japan. There he could have pressed the bloc to provide support for the renegotiation of African debt (he may also have facilitated some new trade deals).

Instead, the G7 got on with its own business and reaffirmed its commitment to the G7 Partnership for Global Infrastructure and Investment and the mobilisation up to $600bn for the initiative by 2027 — an eyewatering sum of money.

Back in Pretoria, we look on at the world through our narrow little window, a bit poorer and a lot more isolated.