By Independent Team & Agencies
After it ended on April 2 the African Development Bank (AfDB) Group President, Donald Kaberuka, who was part of a NEPAD delegation, said the G-20 summit was a major success because it adopted specific African proposals.
I think we made a very surprising level of progress, Meles Zenawi, the Ethiopian Prime Minister, who officially represented the continent, told the Financial Times of London.
The G-20 endorsed his proposal that the International Monetary Fund sell part of its gold reserves to finance a $50bn (‚¬37bn, £34bn) rescue package for low-income countries.
Kaberuka also noted that the AfDB could benefit from the additional US$ 2 billion that the G-20 plans to make available to the world’s five Multilateral Development Banks to enable them to substantially increase their lending.
Kaberuka noted the proposals for improved regulation of the global financial system.
South Africa is the only African member of the G20 but Zenawi was invited to attend in his capacity as Chair of NEPAD, and Jean Ping participated as chair of the African Union Commission.
Before the meeting, a committee of African finance ministers and Central Bank governors that met in the Tanzanian capital, Dar es Salaam, issued a briefing note on the key Africa issues for the G-20.
|Resources available to the IMF will be trebled to US$750 billion.
There will be support for a new allocation of Special Drawing Rights of $250 billion ‘” something that could help poor countries
There will be support for $100 billion more lending by Multilateral Development Banks (those include the World Bank Group and the African Development Bank)
There will be $250 billion support for trade finance.
Use will be made of resources from IMF gold sales ‘for concessional finance for the poorest countries’.
Global financial institutions will be strengthened and reformed, ensuring that emerging and developing economies, including the poorest, must have greater voice and representation.’
Among them were Financial Regulation and Supervision, and International Cooperation, the role of the IMF, increases resource envelope, and increased access to existing resources.
Africa’s demands focused on reforming the regulatory instruments and institutions to mitigate risk to Africa from tax havens, money laundering and terrorist financing, and toxic assets in the Western financial system.
They opposed unilateral action by developed countries to impose new regulations that could reduce availability of credit.
They wanted the IMF to provide advice and temporary financial support related to the global financial crisis.
They wanted the IMF’s resources to be doubled and ensure it benefits the low income countries especially in Africa They proposed that access to the IMF’s longer term concessional resource instruments be increased up to 150% of quota and new emergency funds.
They welcomed the third Board chair for sub-Saharan Africa but demanded reforming the World Bank and other Multilateral Development Banks and proposed policy changes to enable countries to tailor their own responses to particular country and regional circumstances.They noted that although the IMF had lent some US$50 billion to MICs in response to the crisis but only some US$450 Million to LIC yet several MICs had received more. Will that change?
According to an article in the Financial Times, Mr Meles said Africa’s voice had been heard partly thanks to the willingness of Gordon Brown, the British Prime Minister, to allow him and other African representatives to participate in preparations for the summit.
Bob Geldof, the aid campai gner, also welcomed the outcome. ‘The key point for the 50 per cent of the planet who live on less than two dollars a day must be that they have finally been brought in from the margins to the centre of the decision-making process,’ he said.He added that it was now critical to find out whether new money would come in the form of grants or loans.