Nobel laureate, Professor Joseph E. Stiglitz, has called for a comprehensive global plan to help countries cope with mounting debt that has been compounded by COVID-19. Stiglitz, a recipient of the Nobel Memorial Prize in Economic Sciences in 2001, spoke on Friday at the virtual launch of the African Development Bank’s (AfDB) 2021 African Economic Outlook report during a conversation with the bank’s President, Dr. Akinwumi Adesina. Adesina began the exchange by pointing out that Africa’s debt had climbed to around 70 per cent of gross domestic product (GDP). He then sought Stiglitz’s views on the prevailing global debt architecture.
“That’s a question I’ve been very concerned with for a long time … You need debt restructuring, and that needs to be really high on the international agenda. “Every country has bankruptcy laws, but there’s no bankruptcy law for international debt,” Stiglitz added.
“Remember when there’s too much debt, it’s as much the creditor’s problem as the debtor’s problem,” said Stiglitz. Adesina and Stiglitz also discussed recent debt relief efforts, including a debt standstill that the G20 group of wealthy nations presented to the world’s poorest countries in April 2020. Stiglitz said the standstill took place when it seemed the pandemic might only last a few months.
