South Africa’s G20 Presidency is underway. Under South Africa’s Presidency, we have held
a series of G20 meetings over the past few days. Each of these represents a crucial building
block as our Presidency commences.
The Finance Track Meetings, which comprise meetings of representatives from Finance
Ministries and Central Banks, are tasked with focussing on global economic and financial
policy issues.
The discussions range from the state of global economy, stability of the international finance
system, trade and investment as well as development financing. The purpose is to develop
and agree on a set of concrete recommendations, drawn from the various Working Group
Meetings that are grappling with the chosen thematic areas.
We intend to use our Presidency to advance an African agenda. We have taken a balanced
approach and incorporated African priorities into all of our Finance Track Working Groups
to ensure that we operationalise the theme of our Presidency in respect of Africa and
developing countries in general, namely Solidarity, Equality and Solidarity.
In this regard, reviewing the cost of capital for Africa and developing countries in general
would also be essential. This is a significant constraint to economic growth and
development. With its longstanding expertise and track record of work on issues influencing
the cost of capital, the Finance Track will anchor the review. We will take a holistic approach
to ensure that, where applicable, each Working Group will contribute to this vital work so
that we leverage the full array of expertise within the Finance Track on this critical initiative,
including the Finance Track’s established focus on the international financial architecture
and the work of its associated Working Group, as it resonates with many of the critical issues
which will need to be considered.2 of 3
The Issues Notes presented, which drew broad support from G20 members and other
partners, contain many areas that would address high cost of capital. This includes pressing
ahead with Multilateral Development Bank (MDB) reform, accelerating the development of
country-owned and country-led platforms, and promoting measures to increase private
capital, including in the design of funding and derisking mechanisms to facilitate the
mobilisation of private finance. We will also advance efforts to improve the concessionality
of resources, including attention to the rechannelling of Special Drawing Rights to MDBs.
We strongly advocate for an ambitious African Development Fund 17th replenishment in
2025. In our work, we will emphasise steps needed to accelerate the development of local
currency bond markets.
This year, beyond the regular monitoring of capital flow dynamics through regular updates
from international organisations, the G20 Finance Track will also give particular attention to
the role of non-bank financial institutions in understanding the vulnerabilities that contribute
to capital flow volatility and supporting strategies to achieve more sustainable and resilient
capital flows. Of course, throughout the year, we will be focusing strongly on debt, debt
sustainability, and support for countries with liquidity challenges in Africa and other
developing countries.
We are also focusing on improving the enabling conditions to accelerate infrastructure
development and finance in Africa and other developing countries, expanding the use of
blended finance instruments to de-risk sustainable infrastructure projects, and creating a
toolkit for African countries to overcome barriers to cross-border infrastructure and to
advance critical projects that support operationalisation of the African Continental Free
Trade Agreement. In all of these initiatives, we will work closely with our partners and
international organisations.
As we build momentum with our work, we will provide input across all of these workstreams
to the Fourth International Conference on Financing for Development (FfD4), to be held in
Spain in June 2025.
The Minister of Finance will appoint a G20 African Expert Panel to advise the Minister on
matters of policy, financing, and outcomes to be achieved during the G20 Presidency. The3 of 3
Panel will be chaired by Mr. Trevor Manuel and composed of leading African economic,
development, and finance experts from the public sector, think tanks, academia, and
international financial institutions.
The Panel will explore, analyse, and define strategies that South Africa should advance for
the benefit of Africa. The Minister of Finance will request the Panel to advise on aspects
such as the cost of capital to Africa and developing countries in general. Here, the Panel’s
work will assist the Minister on the critical issues to be considered, how the range of
initiatives within the G20 and the UN system can be leveraged, the requirements to help
galvanise support among all the relevant stakeholders, and how this initiative could
strengthen multilateralism.
The Minister will review the Panel’s work and determine how it could be considered in the
ongoing work of the Finance Track Working Groups. Given the considerable interest in this
matter, we will provide a periodic update on how the work is processing.
Issued by Ministry of Finance
