a day ago
Bessent no-show, Brics tensions set to cast shadow over Durban G20 meeting
'Policy uncertainty is the biggest theme now,' South African Reserve Bank deputy governor Fundi Tshazibana told Reuters.
The G20 has its origins in past crisis firefighting and took off as countries around the world saw a need to co-ordinate policies to emerge from the global financial crisis of the late 2000s.
'The G20 was built around a presumption that all the world's major economies shared a common interest in a stable, relatively open global economy,' said Brad Setser of the Council on Foreign Relations. 'But Trump doesn't care about stability and wants a more closed global economy.'
The Durban gathering of finance chiefs on Thursday and Friday also unfolds against a backdrop of mounting economic pressures, particularly for African economies. Sub-Saharan Africa's external debt has ballooned to $800bn (R14.24-trillion), or 45% of GDP, according to Goldman Sachs, while traditional funding sources are drying up.
Chinese lending has slowed to a trickle after years of expansion, leaving an $80bn (R1.42-trillion) financing gap.
'The views they've expressed are if you negotiate them down before taking the loan, they will go with that,' said Trevor Manuel, former finance minister of South Africa who is leading the Africa Expert Panel of the G20. 'But once the loan is made, they expect a return and that is embedded in their legislation. So that is one issue that needs a lot of attention.'
China's Belt and Road Initiative has brought significant resources to the African continent, 'but there are also the offsets', said Manuel. 'I think that part of the push in future is greater transparency, which means some of the barter arrangements and so on need to be dealt with differently.'
