By Thapelo Molefe
The heightened uncertainty that has characterised the global economy for the past five years persists, and G20 countries as a bloc with mostly developing economies, must find solutions.
This was a key message of Treasury director-general Duncan Pieterse, who spoke at the 4th G20 Finance Track Meeting of Finance and Central Bank Deputies meeting held at Zimbali outside Durban in KwaZulu-Natal.
“We are meeting at a moment of ongoing uncertainty in the global economy,” Pieterse said
“While there are signs of resilience in some areas, various challenges remain: uneven growth, high debt levels, inflation and tighter financial conditions.”
This has been a feature of the global economy since the outbreak of the Covid-19 pandemic five years ago. It was followed by the cost-of-living crisis sparked by the Russia-Ukraine conflict and sustained by the conflict in the Middle East.
Pieterse said that long-term changes such as digitalisation, climate finance and demographic shifts were also shaping global economies.
“The multilateral system is being tested,” Pieterse said, “and our collective ability to respond, will shape the pace of our recovery, but also the prospects for inclusive and sustainable development.”
“As the G20, we have the responsibility to demonstrate leadership, and our Presidency places a very strong emphasis on strengthening the role of the G20 in delivering concrete solutions,” he said.
The DG highlighted the need to improve the financial system, deal with debt and liquidity problems and support development.
Over the next two days, the deputies will focus on several key topics. Monday’s session started with a report from the Council of Europe Development Bank about how development banks were working together to improve results.
This was followed by a simulation led by the World Bank to demonstrate how the world could respond quickly to a pandemic.
On Tuesday, the International Monetary Fund (IMF) and World Bank will update the group on the Global Sovereign Debt Roundtable (GSDR).
Pieterse said this session was aimed at improving information sharing and making debt restructuring more effective.
He noted that a GSDR playbook on how to handle debt problems was released in April and that another guide was released by the G20 on how to manage debt under the Common Framework.
Later, former South African finance minister Trevor Manuel will give an update on the work of the Africa Expert Panel.
Pieterse said this session would show how Africa’s development goals could be included in the G20’s global economic plans.
Pieterse said the discussions that started virtually last week had helped build a strong base for this week’s work.
The goal is to reach agreement on a communique that will be presented to G20 finance ministers and central bank governors later this week.
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