Experts meet to reform global finance

FREDERICK KEBADIRETSE
Staff Writer | Monday June 7, 2010 00:00

 

The meeting, which started on Thursday and ended on Friday at the Grand Palm resort, brought together high-level officials from the ministries of finance, central bankers and experts in development finance from around the African continent.

The objective of the meeting was to determine ways of enhancing the African voice, representation and participation in the International Financial Architecture.

Addressing delegates during the official opening, Bank of Botswana Governor Linah Mohohlo said the need for a new international financial architecture has been evident for some time, but became more evident in the wake of the 2008/2009 US-generated international financial crisis and the consequent global recession from which most countries are still recovering.

Mohohlo said some action has been taken to remedy the weaknesses in the current global financial relations, especially in areas of information dissemination, disclosure, codes of conduct and supervisory rules, However, she said, progress has been slow on issues of fundamental concern to developing countries.  'Although it should be recognised that globalisation of international finance and banking is not the underlying problem,' Mohohlo said, 'these successive crises have highlighted the need to remedy the existing mismatch between two components of the system.'

She said it is essential to reconcile past and current trends in globalisation with institutional governance structures and rules that ensure the smooth functioning of the global financial system for the benefit of developed and developing countries alike.

'That is why the search for a new global international financial architecture must address issues of governance and rules governing global financial flows,' she said.

It should be acknowledged that the representation of developing countries in major international institutions that, in principle, are founded on consultation such as the International Monetary Fund (IMF), the World Bank and the World Trade Organisation (WTO), should be significantly increased, she added.

Addressing the same meeting, the Resident Representative of the United Nations Development Programme (UNDP) to Botswana, Khin-Sandi Lwin, said with efforts to reshape the global financial architecture still very much in a discussion phase, Africa should be heard in the international debate.

'As these discussion gain momentum, the UN will encourage its members both to consult closely with each other and to coordinate reforms,' Lwin said. 'A coherent global approach to these issues offers the best chance of limiting the risk of uncoordinated policies, distorted capital flows, and regulatory arbitrage.'

She called upon the meeting to sharpen Africa's position regarding the debate on reforming the global financial architecture.

Various topics on financial crises reforms and financial architecture were discussed at the meeting.

Representatives from around the continent, among them the Assistant Directors of the Banks of Nigeria, Ghana and Tunisia also attended.