From 22 ND June to 23 rd June the Kenyan president William Samoei Ruto attended the global impact summit lunched by President Emmanuel Macron in Paris.
WHAT IS THE GLOBAL PACT FINANCE SUMMIT?
The Global Pact Finance Summit in Paris was an event that brought together governments, international organizations, and actors from the private sector.
The aim of the Summit was to confront environmental, economic and health crises that have been increasing globally for the past decade.
The debates and discussion held during the summit, were oriented into finding innovative solutions to create a new financial system that would include central banks, the private sector, governments, organizations, and other important actors of society.
To understand some of the implications that the summit might have on Kenya and east African region, we will first analyze why the idea of new finance global pact is a real preoccupation its future and its consequences.
GLOBAL CLIMATE CHANGE: A THREAT AGAINST KENYA’S
Kenya has been facing severe droughts, floods and locust invasion making solutions against climate change a necessity for the country’s well-being. Between 2003 and 2005 the locust’s invasion alone destroyed around 200 tons of vegetation according to Journal of Orthoptera Research .Today, natural disasters are still a threat to the nation’s food security but also its world life, economy, and social stability.
Food Insecurity
According to a European union’s study Kenya has around 4.4 million people facing a high level of food insecurity. Although the Nairobi recently launched a meal program in its county’s schools, there is a real demand for widening such programs on a national scale to have long term structural changes.
Wildlife
According to wildlife and tourism officials “climate change is killing more elephants in Kenya than poaching. It also poses the biggest threat to the conservation of their lives.”
Climate Change Kills More Elephants than Poaching, Kenya Says (greekreporter.com)
In 2022 more than 179 wild animals were killed due to climate change, affecting mostly elephants.
Economy
Families from the rural area deeply depend on agriculture as their source of income. Therefore a loss in their harvest has severe impact on their lively hoods.
Social Instability
Climate change has an important effect on social stability due to the economic problems and food insecurity that it rises. One of the examples being the unequal effect that climate change has on women.
Numerous studies have shown the consequences that climate change has on women’s rights. For instance, more and more girls have to leave school because of lack of resources caused by agricultural loss.
Explainer: How gender inequality and climate change are interconnected | UN Women – Headquarters
RUTO’s Point of vue and solutions.
These are few points on that President Ruto brought up:
1 In the creation of a financial system it is crucial to take into consideration that many African countries are already highly in debt.
2 The new financial system should include all countries: making them all equal decision makers.
3 Every member of the new financial system should be a shareholder “We want to pay because we want to be on the table” the president affirmed.
4 African countries would be an important asset to the new system because the continent holds the largest renewable energy reserves in the world.
5 The new financial structure would include global financial taxation and not limit itself to national one.
6 The taxes would be commensurate to the country’s economy.
Watch the full video on:
(46) President William Ruto on The Summit for a New Global Financing Pact in Paris – YouTube
WHAT RETURNS TO EXPECT FOR THE COUNTRY AND EAST AFRICAN REGION?
The east African region is known to be one of the most developing areas in the continent. For the last years its average GDP was 5 percent. The region is seeking important financial investments to maintain and increase its growth.
Until then, the main finance institutions to finance projects in the region were: China, the European union, world bank and the UN. Even though external investment is a key element for the region’s development however, the high level of debt and interest rates have had major negative consequences on the region such as:
A lower power of negotiation
Dangerous debt traps
Threats against country’s sovereignty
Important conflicts of interests
A rise of the inflation rate
Therefore, it is of gran urgency to create a new financial pact that would take into consideration the deficiency of the actual financing systems.
The new finance system might also affect international relations between countries:
On the one hand it might help create more unity and fight against the tensions between developed countries and developing countries and the conflicts between big emitters countries against low emitters.
But on the other hand, a new financial system might disrupt the current international power distribution in the long term. In an age where the main superpowers China and the United States are fighting to be better than the other by different means including diplomatic power thanks to their financing institutions and the European Union trying to refine what position they hold of the international platform. We might then wonder what the future international relationships between the east and the west would look like? What would be the new strategies of influence, perhaps technology? Indeed, because even though Africa does have important resources, we cannot ignore the fact that we live in an interdependent world and cooperation is necessary. Hopefully the new finance pact will enable the new cooperation to be truly equitable.
Internal Victories
A new financial system would also be a key element in the promotion of sustainable projects for all countries members of the new financial pact. The completion of these projects will require an important need of work force which will generate new opportunities for employment.
Although Kenya is mostly known for its athletes it is also famous for its safaris. Tourism represents about 8 percent of the country’s GDP. Therefore, fighting against climate change does not only contribute greatly to the conservation of the country’s wildlife but it also participates in the country’s economy.
In 2022 President Ruto declared in his manifesto that lowering the cost of food production was a priority to lower the cost of living. We can then hope that new financial resources craeated by the new financial finance pact may help achieve
