eBusiness Weekly
Business Reporter
Econet founder and pan-African businessman Strive Masiyiwa says the quickest and most effective way for African governments to stimulate the economies, help businesses (big and small), and save millions of jobs in the face of the coronavirus threat is for them to pay suppliers and settle their domestic debts.
Writing on his popular Facebook blog, Masiyiwa says governments, including local authorities and State Owned Enterprises (SOEs or parastatals), should immediately pay their suppliers for goods and services rendered.
“This will pump liquidity into the productive sectors of the national economy.
“Even businesses that don’t supply governments, local authorities, and SOEs will benefit,” Masiyiwa says.
“African governments owe more than US$300 billion in international debt. The need to pay interest on these debts means foreign exchange shortages. But with oil, tourism, remittances, and commodity prices all down, we have a big problem.
“Settling domestic government debt — better known as ‘unpaid bills’, or late payments — and suspending further enforced borrowing of this nature by governments is critical to save an economy during this crisis.”
He says businesses need liquidity so they can pay their staff and suppliers.
“So, let’s get rid of the grid lock of domestic debt. Kenya, Rwanda, and SA have led the way in this area. Others can follow.”
