Executive Summary
The ITUC-Africa Position Paper on Debt is a timely and urgent intervention as Africa faces an alarming sovereign debt crisis, with over half of African countries at high risk of distress, debt-service costs consuming more than 50% of government revenues in some cases, and governments forced to choose between paying creditors and providing essential services. This debt emergency has become a social and human development crisis, undermining jobs, wages, education, health, and social protection, and it calls for trade unions and civil society to step beyond protest into policy advocacy, monitoring, and global engagement. The Sovereign Debt New Deal proposed here offers unions and their allies a comprehensive advocacy platform to push for reforms that make borrowing strictly development-driven, legally tied to high-return investments in infrastructure, health, education, and peace-building, with parliamentary scrutiny of all loans and annual impact audits. It urges adoption of an African Doctrine on Debt that exempts climate, resilience, and security spending from sustainability tests, recalibrates thresholds to reflect growth potential and demographics, and guarantees automatic standstills during systemic shocks. It demands the completion of Africa’s financial safety net by 2027 with an African Monetary Fund, an African Financial Stability Mechanism, and an African Credit Rating Agency to counter external bias. It calls for transforming the G20 Common Framework into a fair, time-bound mechanism binding all creditors, alongside negotiations for a UN Sovereign Debt Workout Treaty to establish a permanent, rules-based restructuring system. It emphasises turbo-charging domestic resource mobilisation by broadening tax bases, cancelling exemptions, curbing illicit financial flows worth US$90 billion annually, conserving foreign exchange through the AfCFTA Pan-African Payment and Settlement System, and mobilising US$50 billion in green, blue, and climate-linked bonds by 2030, scaling up debt-for-nature swaps pioneered by Cape Verde, Gabon, and Morocco. It insists on iron-clad transparency and oversight, requiring the publication of all loan agreements, quarterly debt-versus-social spending ledgers, independent trade union audits, and full parliamentary approval before borrowing. It calls for Africa to speak with one voice in global fora to secure fairer SDR reallocation, reform multilateral bank capital rules, and enforce creditor-parity laws, while embedding accountability through AU peer-review dashboards at an annual Economic and Monetary Summit. Globally, it presses for a UN-anchored Sovereign Debt Workout Framework with strict timelines, automatic standstills, and a neutral tribunal, permanent Global South representation on key bodies, needs-based SDR allocations re-channelled to African banks, climate and labour-impact tests in all major loans, and legislation to curb vulture-fund litigation. Finally, it urges the creation of permanent monitoring and advocacy pillars through union-led National Debt-Monitoring Task Forces publishing real-time scorecards on social impacts, reinforced by South-South and North-South coalitions uniting unions, civil society, academics, and pro-labour legislators to win transparency, secure independent audits, and cancel odious or corrupt debts. For unions and civil society, these recommendations are not abstract, they are tools for advocacy and engagement to defend workers’ livelihoods and reclaim Africa’s fiscal sovereignty for development, justice, and shared prosperity.