JOHANNESBURG, Nov 23: G20 nations have underscored the need for enhancing the representation and voice of developing countries in decision making in Multilateral Development Banks (MDBs) like the World Bank and IMF and other international economic and financial institutions.
“In that context, we welcome the creation of a 25th chair at the IMF Executive Board to enhance the voice and representation of Sub-Saharan Africa,” as per the leaders’ declaration during the G20 South Africa Summit held in Johannesburg.
G20 leaders reaffirm the critical role of MDBs in driving poverty reduction, economic growth, and development across client countries.
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“We welcome the inaugural Progress Implementation Report on the G20 MDB Roadmap by the Heads of MDBs Group. We further acknowledge the Capital Adequacy Framework’s (CAF) potential to help MDBs more efficiently utilise existing resources, share more risk with the private sector and utilise new instruments to increase lending capacity over the next decade and recognise the need for continued work by the MDBs to implement the G20 Roadmap and CAF reforms,” it said.
G20 reaffirmed its commitment to a strong, quota-based, and adequately resourced International Monetary Fund at the centre of the Global Financial Safety Net.
“We support continued IMF collaboration with Regional Financing Arrangements (RFA). We have advanced the domestic approvals for our consent to the quota increase under the 16th General Review of Quotas, and we look forward to finalising this process with no further delay. We acknowledge the importance of realignment in quota shares to better reflect members’ relative positions in the world economy while protecting the quota shares of the poorest members,” it said.
G20 declaration, however, said building consensus among members on quota and governance reforms will require progress in stages.
Leaders of G20 countries also expressed commitment to the effective implementation of the G20 Roadmap for Enhancing Cross-Border Payments and to take appropriate further actions as necessary to achieve its goals.
It also noted the important role of the Financial Stability Board (FSB) and international standard setting bodies (SSBs) to monitor financial risks and vulnerabilities and to develop sound financial standards and recommendations to maintain financial stability and to enhance the resilience of the global financial system.
“We welcome the FSB’s thematic peer review on the implementation of its high-level crypto assets and stablecoin recommendations, and we encourage the implementation of the FSB’s and other SSBs’ global regulatory framework in this regard.
Most members recognise the importance of addressing climate-related financial risks, it said, adding that these efforts are essential in safeguarding financial stability while promoting responsible innovation.
On the debt vulnerabilities, it said, while the risk of a systemic debt crisis appears to be broadly contained, many vulnerable low- and middle-income countries face high financing costs, large external refinancing needs, and a significant outflow of private capital.
These debt vulnerabilities, along with other factors, can constrain their fiscal space, their ability to address poverty and inequality, and their capacity to invest in growth and development, it said.
“We welcome the recent progress of the Common Framework and note that, five years after its creation, it provided debt treatments to the four countries that had requested it, namely Chad, Zambia, Ghana and Ethiopia,” it said. (PTI)
