3 questions to Ndidi Okonkwo Nwuneli, President and CEO of the ONE Campaign

3 questions to Ndidi Okonkwo Nwuneli, President and CEO of the ONE Campaign

Written interview received on September 17, 2024.

Focus 2030 : The Summit of the Future, to be held on the sidelines of the 79th session of the UN General Assembly on September 22 and 23, will be a crucial moment to reinvigorate multilateralism and international cooperation to achieve the SDGs by 2030. What are your expectations of this Summit and the proposed “Pact for the Future” ? What actions should be implemented as a priority ?

Ndidi Okonkwo Nwuneli : The ambition of the summit for the future is high. The great benefit of the UN’s convening power is that everyone has a voice. The greatest weakness is that everyone has an agenda - and so focus is the greatest challenge. Without focus you can’t achieve anything.

What we can hope for is a level of consensus on some top priorities that activists around the world can use to push their governments to do more for our people and our planet.
In my view these are addressing the debt crisis facing low and middle income countries, increasing concessional finance through fully funding International Development Association (IDA), the World Bank’s low income country fund, finishing the job on multilateral development bank reform, and investing in health - particularly Gavi, the vaccines alliance.

There is an African proverb which says - ’If you want to go fast, go alone. If you want to go far, go with others”. Given the sense of urgency and issues of our time, we must go fast and far together. ONE is committed to partnering with other organizations.

We must leave our egos and logos at the door and work with integrity and excellence to fight for the investments and policies required to ensure healthy lives and economic growth in Africa.

Focus 2030 : Rethinking the international financial architecture is one of the priorities envisioned in the “Pact for the Future”, to be endorsed by Member States during the Summit. A recent study by ONE revealed that due to debt service repayments, developing countries are projected to become net financial contributors to the rest of the world economy. What urgent actions should be implemented by the international community to address this issue and unlock funding for development issues such as health, education, and poverty reduction ?

Ndidi Okonkwo Nwuneli : ONE’s data and analysis show that even though progress has been made to meet financing needs for development and climate priorities, much more needs to be done to fill the remaining gaps. Here’s our four-point plan :

1. Increase official development assistance (ODA). ODA has been almost stagnant for a decade, rising just 0.06 percentage points of GNI between 2010 and 2023. High-income countries must prioritize aid budgets to help with global economic growth and climate adaptation, particularly in low-income and fragile states.
2. Channel funds to where they have the most impact : Governments must ensure a robust replenishment for the World Bank’s International Development Association. Donors should increase commitments by at least 25% in total. This will allow low- and middle-income countries to access the low-cost financing they need to build healthy, resilient communities.
3. Finish the job on reforming multilateral development banks (MDBs) : Hundreds of millions of additional dollars could be unlocked from the MDBs through reforms that cost limited additional investment. Progress has been made, but the governments that govern these banks (mostly high-income countries) should give greater value to callable capital, better reflect preferred creditor treatment, and enhance efforts to mobilize private capital.
4. Unlock IMF Special Drawing Rights (SDRs) : SDRs are a reserve asset that can boost resources for low- and middle-income countries at low cost. The US$112 billion in SDRs that advanced economies have committed is welcome and will lead to increased lending through the IMF. But governments must unlock the potential of channeling SDRs through MDBs, where each dollar of SDRs could be leveraged to US$4 and lent for maximum impact.

Focus 2030 : What are the barriers to greater representation of African countries in international institutions, particularly financial ones, and how does this underrepresentation impact resource allocation for their economic and social development, as well as progress toward achieving the Sustainable Development Goals (SDGs) ?

Ndidi Okonkwo Nwuneli : The barriers to greater representation of African countries in international financial institutions, like the world Bank and IMF include historical power imbalances, unequal voting rights, and entrenched governance structures that favor wealthier nations and smaller economies.

African countries, along with other Global South nations, are significantly under-represented in the decision-making structures of the IMF and the World Bank based on design. Voting shares are based on the size and openness of economies, favoring wealthier countries such as the U.S., European nations, and Japan. Despite voting reforms in 2016, the U.S. retains veto power over critical decisions, solidifying the dominance of richer countries. For instance, China saw a slight increase in influence post-reform, but Africa’s voting power remained largely static, reflecting ongoing imbalances.

Today, African countries hold only a fraction of the voting power—Sub-Saharan Africa accounts for less than 6% of IMF quotas despite being home to over 1.5 billion people (over 18% of global population).

Economic Policy Conditionalities : The IMF and World Bank often attach stringent economic policy conditions to their loans, which can undermine the sovereignty and policy autonomy of African nations. For example, in 2017, the World Bank issued 434 "prior actions" required to access its loans, which often include macroeconomic policy reforms such as fiscal austerity, public sector cuts, and privatization

Implication for Development : Limited Decision-Making Power : African countries have less space to shape global financial policies that directly affect their economies given the dependence on financial rule from other more affluent countries. For example, SDR recycling to AfDB, while approved by the IMF board is constrained by the European Central Bank with rules that protect Europe even when it adversely impacts Africa. This lack of influence means that global financial policies may not align with Africa’s development needs, leading to ineffective support structures for issues like infrastructure financing, healthcare, or education.

Unfair Distribution of Resources : African countries may not always receive the most favorable terms or the necessary financial assistance in times of crisis. The locus of production of critical products such as vaccines are housed in non-African countries who control supply after their needs have been met.

Policy Disadvantage : As decision-making remains concentrated in the hands of developed countries, African countries often have little say in the policies attached to loans and assistance. These policies may not take into account local conditions and may further constrain Africa’s policy space.

This financial inequality hinders their progress toward achieving the Sustainable Development Goals (SDGs), particularly in areas like poverty reduction, education, and health, where significant investment is required. Addressing these disparities is crucial for more inclusive global economic governance and sustainable development.

Increased representation in the governance of international institutions is key to the future of the continent. African leaders have continued to demand for better representation, including the reform of the IMF’s quota system, which allocates voting shares to member states.