The OECD and South Africa are getting tough on public debt and cash management in Africa by setting up a centre in the country to reduce the cost of managing public debt in Africa and encourage the development of financial sector products.
OECD secretary general Angel Gurría and Finance Minister Pravin Gordhan signed a memorandum of understanding at a ceremony in Paris on Wednesday during the OECD ministerial council meeting.
The centre in Midrand, which will start operations on June 30 2011, aims to encourage cooperation among African debt managers and to support the development of sound practices in public debt and cash management, in order to create stronger securities markets. It will also encourage the implementation of a stronger infrastructure for government securities markets.
As the OECD celebrates its 50th anniversary, this new centre symbolises the organisation’s increasing cooperation with emerging and developing economies, said Gurría. The centre will help reduce the cost of managing public debt and encourage the development of financial sector products including mortgage loans, micro-credit and financing for small and medium-sized firms, ultimately supporting Africa’s development.
“With the most advanced financial market on the African continent, we look forward to partnering with the OECD in facilitating and building capacity of our neighbours in the region,” said Gordhan.
Experts operating from the centre will train African government officials and work with them to develop better markets and practices across the continent. The centre will also create a government debt database to monitor and analyse debt and sovereign risk in Africa, as well as conduct regular research and monitor bond market developments.
The OECD has been working since 2006 with government debt management officials in Africa. — I-Net Bridge