Maravi

Advanced economies must shun protectionism, says SA governor

Advanced economies must shun protectionism, says SA governor
By Joan Chirwa
Tuesday April 22, 2008 [04:00]

ADVANCED economies must shun protectionism and cut significantly agricultural subsidies for a successful outcome of the Doha Round, South African Reserve Bank governor Tito Mboweni has said. Presenting a statement to the International Monetary and Financial Committee of the IMF on behalf of South Africa, Zambia and other countries in the sub-Saharan region, Mboweni said the cut in agricultural subsidies and tariffs by the developed countries could lead to a successful Doha outcome in the global interest.

He said the slow and uneven progress of the Doha Round negotiations since resumption in late 2006 was disappointing and called for an early and substantial conclusion of the Round.

"It is our view that progress, at the desired pace, will not be made without courageous and purposeful leadership from advanced economies," Mboweni said. "In addition, aid for trade facilitation needs to be sustained.

We also stress that multilateral trade reforms, facilitating a better functioning of the international trading system, would be helpful in securing market access for developing countries' exports."

Mboweni said strong growth momentum in Low Income member Countries (LICs) would eventually reflect positively on the weakening global economy.

"We in the sub-Saharan Africa therefore expect the International Monetary Fund (IMF) to play an effective catalytic role in bringing about prompt and successful conclusion of the Doha Round.

In a similar vein, we suggest that assistance in implementation of trade-related reforms and strengthening of LICs' competitiveness needs stepping up under the Enhanced Integrated Framework (EIF), while donors should redeem pledges made for increased aid for trade in line with the Paris principle on aid effectiveness."

And Mboweni said countries in sub-Saharan Africa require a sustained average annual growth rate of over seven per cent in order to lift the region out of poverty and achieve the Millennium Development Goals (MDGs).

"This could only be brought about through deliberate efforts to expand the sources of growth, including diversification of our economies and overcoming other challenges to meeting the desired growth targets," said Mboweni.

"Such challenges include, low savings and investment, erosion of trade preferences, oil price-induced shocks for net oil-importing countries, drought, unpredictable aid flows, HIV/AIDS, and possible continuous global economic slowdown.

We consider that persistent implementation of sound policies in sub-Saharan African countries and strong support of the international community and the Fund are critical in overcoming the constraints to sustainable growth for poverty reduction and meeting the MDGs."

Labels: IMF, SOUTH AFRICA, TITO MBOWENI

posted by MrK @ 3:23 AM