Gordhan: World needs to deal with capital inflows

The world needs to deal with the rapid movement of capital flows, which is affecting the competitiveness of many countries, Finance Minister Pravin Gordhan said on Tuesday .

“We need to find a global solution to what is clearly a global problem,” he said in Pretoria ahead of his departure to Seoul, South Korea, for a G20 summit.

Such rapid movements of money affected the currencies of developing countries and the competitiveness of South Africa and many other nations.

In the past few weeks there had been several appeals against countries engaging in competitive devaluation of their currencies, or entering into any form of trade protectionism.

The solution did not lie only in developing countries defending their currencies.

“The answer lies in finding a multilateral formula which would enable us to have actions taken at the source of these funds that are flowing around the world, and also at the destination of these funds.”

‘New global economic and financial architecture’
Gordhan believed this was a symptom of the “birth pangs of a new global economic and financial architecture” following the recent world economic recession.

He said the world was beginning to realise that job creation, imbalances between major economies, development and poverty eradication could not be seen in isolation.

“We need to ask what’s our vision of a new global economic and financial architecture. What are the different components that make it up and how do we deal both with the immediate crises, like the currency crisis that we have, and also lay the basis for a more medium-term sustainability around the globe itself.”

He said this would be a key issue for discussion at the conference.

The summit would also look at the reform of international financial institutions such as the International Monetary Fund and the World Bank.

“You cannot have a global organisation that is not democratically founded.”

He said South Africa would be arguing for better representation of developing countries at these institutions, as well as for the heads of these organisations to be appointed in a more democratic manner.

The G20 would also deal with financial safety nets, or mechanisms to ensure developing countries received support during crises. This would “ensure they do not come off worse after the crisis than they were before the crisis”. — Sapa

Staff Reporter
Guest Author
Advertisting

Study unpacks the ‘hidden racism’ at Stellenbosch

Students say they feel unseen and unheard at the university because of their skin colour

Workers’ R60m ‘lost’ in banks scam

An asset manager, VBS Mutual Bank and a Namibian bank have put the retirement funds of 26 000 municipal workers in South Africa at risk

‘Judge President Hlophe tried to influence allocation of judges to...

Deputy Judge President Patricia Goliath accuses Hlophe of attempting to influence her to allocate the case to judges he perceived as ‘favourably disposed’ to former president Jacob Zuma

SAA grounds flights due to low demand

SAA is working to accommodate customers on its sister airlines after it cancelled flights due to low demand
Advertising

Press Releases

MTN unveils TikTok bundles

Customised MTN TikTok data bundles are available to all prepaid customers on *136*2#.

Marketers need to reinvent themselves

Marketing is an exciting discipline, offering the perfect fit for individuals who are equally interested in business, human dynamics and strategic thinking. But the...

Upskill yourself to land your dream job in 2020

If you received admission to an IIE Higher Certificate qualification, once you have graduated, you can articulate to an IIE Diploma and then IIE Bachelor's degree at IIE Rosebank College.

South Africans unsure of what to expect in 2020

Almost half (49%) of South Africans, 15 years and older, agree or strongly agree that they view 2020 with optimism.

KZN teacher educators jet off to Columbia University

A group of academics were selected as participants of the programme focused on PhD completion, mobility, supervision capacity development and the generation of high-impact research.

New-style star accretion bursts dazzle astronomers

Associate Professor James O Chibueze and Dr SP van den Heever are part of an international team of astronomers studying the G358-MM1 high-mass protostar.

2020 risk outlook: Use GRC to build resilience

GRC activities can be used profitably to develop an integrated risk picture and response, says ContinuitySA.

MTN voted best mobile network

An independent report found MTN to be the best mobile network in SA in the fourth quarter of 2019.