ANALYSIS: Africa’s new man at IMF

But developed countries also know that there is a cost to imposing their views on other states. As a result, they tend to be more open to persuasion on issues that affect them less directly. Thus, at the margins, African countries can expect to win some concessions. But this will only happen if they are clear-eyed about global political and economic realities. They will also need to carefully pick their issues to effectively make their case.

The scope for making gains obviously expands if their representatives play a leading role in the institutions of global economic governance.

How can they make the most of the opportunities created by Kganyago’s appointment?

Gains to be made

First, although the global economy is in better shape, it’s still subject to a great deal of uncertainty. As major central banks raise interest rates they could cause problems for sovereign and corporate debtors in developing countries. There are also significant geopolitical, technological, and environmental risks. Having an African as chair of a major global economic governance committee could help ensure that the concerns of African countries receive appropriate attention.

Second, as the global order evolves, more attention will need to be paid to adapting the governance of the IMF and the other institutions of global economic governance. Inevitably, most attention will be paid to the concerns of the major powers– old and new.

The interests of Africa, the most under-represented region in global economic governance, can easily be ignored in this context. But having an eloquent and respected African as the chair of a major committee will mitigate this risk.

Third, Kganyago’s appointment can facilitate better relations between Africa and the IMF. Historically, many African countries have found the social cost of its assistance extremely high. Nevertheless, there are a number of African countries, including South Africa, which could find themselves being forced to seek IMF assistance over the next three years. In this event, having a senior government official in a high profile international finance position could be very helpful in facilitating dialogue with the IMF.

Kganyago can help make sure that the IMF fully understands the governance and institutional challenges that African countries face. This should help in the push to create sustainable and inclusive economies that have a realistic chance of meeting the 2030 sustainable development goals.

Kganyago’s appointment creates the possibility for African countries to move global economic governance a few millimetres in their direction. It’s not an insignificant development in international economic diplomatic terms.

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Danny Bradlow, SARCHI Professor of International Development Law and African Economic Relations, University of Pretoria

Source: The Conversation