Beninese Minister of Economy and Finance Romuald WADAGNI on Rfi this Wednesday, May 19, 2021, interviewed by Christophe BOISBOUVIER. On the menu, the meeting in Paris, international financial solidarity for the benefit of developing countries, debt, the sustainability of this debt, the necessary good governance. Read the full interview with Patrice TALON’s representative at the Summit on the financing of African economies. The participants at the Paris summit expressed the wish that the International Monetary Fund (IMF) release some 100 billion dollars for Africa in the form of Special Drawing Rights (SDRs). But isn’t that wishful thinking? No. For us this is not a wishful thinking because in reality, this proposal to have new resources is the one that Benin, through the voice of President Patrice TALON, defended in April 2020 when he sent a note to all the leaders of the G20 as well as to the leaders of international institutions such as the IMF proposing three solutions, the first of which is the use of SDRs to provide new resources to our countries. I also recall that the International Monetary Fund estimates that the emergency needs for Africa by 2025 amount to some 285 billion dollars. So, hoping for 100 billion out of a need for 285 is not wishful thinking since we know very well that the amount planned to be released under SDRs today is of the order of 650 billion. Yes, but it is necessary all the same that the rich countries which have these Special Drawing Rights in priority give up their share and agree to reallocate them to African countries for example. This is the whole point of global solidarity. You know, international solidarity is manifested today by the ability of one country to be able to give their quota of SDRs to other countries. But it is not won, Minister. France said yes but the United States has not yet said yes, far from it … It’s not winning at all. But for us already, part of the battle has been won because, remember again, in April 2020 when President Patrice TALON asked to think about the direction of the new allocation of DTS, we were the only ones. , Benin was the only one to do that. Today that there is unanimity around this position, it is already good news and we are convinced that the countries will follow the French proposal to go towards this allocation. You want Americans, Japanese and everyone to follow what … We want them to follow. And I recall that Japan participated in the summit earlier and did not object in this plea An extension of the moratorium on debt repayment until the end of the year. Is this good news for you? We are true to our position and I am delighted that the final declaration which you have certainly received is not a place for debt cancellation or a moratorium. We consider that debt issues for countries with special situations should be dealt with on a case-by-case basis; but that changes the solution for Africa in general. There are solutions that we believe should be given priority, namely the allocation of SDRs. So for Benin, a moratorium on debt repayment is not a priority, is it? For Benin, the debt moratorium is not a priority, no. And why, because you want to be able to always be credible in the eyes of financial institutions that can lend money? Our logic has always been to say that when you have hard won credibility on the market place in a period of crisis, the first instinct is to make sure you have the capacity to honor your commitments. And therefore, all the solutions which allow the country to have new resources to honor the commitments must be privileged. That is why we welcome the initiative to issue DTS. That said, there are countries which have specific situations and which need to sit down with the lenders, the donors to renegotiate, to reschedule the debts. These situations can exist and no one can oppose these situations. But in principle, if it is possible to find solutions to have new cash flow, and to be able to always honor its commitments, it is preferable to go in this direction because it is the direction that allows to preserve the signature, credibility and the ability to return to the market. It was yesterday on RFI, the French Minister of the Economy, Bruno Le MAIRE had this sentence: “to resolve the issue of over-indebtedness in African countries, people must pay taxes. When you have 60% of debt but only 5% of tax receipts you cannot pay off this debt ”, what do you think? In terms of debt, we agree that the first point is to make the necessary efforts to increase its capacity to mobilize internal revenue. And the reforms to modernize the authorities, limit corruption, losses in the public revenue collection chain, make every effort to reduce the weight of the informal sector and broaden the tax base. Here, our countries are committed to these various reforms and it is the more we cash in, the more we accumulate own resources, the greater the capacity to have access to external financing. Now, when it comes to debt, I think that to build a road that has a lifespan of 30 to 40 years it is unthinkable that we go into debt at 5 or even 7 years at rates of 10% . This is what we see in a few countries. Because the pressure of the population is there for the investment to be carried out. So, is it better to borrow at 30 or 40? It is better to borrow long and seek very long financing At lower rates Even if you have an investment that is necessary for the population, if we mask this investment, you will have poor quality debt which could pose problems of sustainability. The second element which is fundamental is that I manage to mobilize resources with consistency between the duration of the investment and the project but I have poor governance in the execution of the project and therefore that means that it is also necessary to continue the efforts for more transparency in the procedures of procurement and in all the governance which surrounds the execution of the projects financed by the resources Shouldn’t the project cost twice as much as expected? Absolutely.