The G-20 and financial regulation in Africa

The Group of Twenty (G-20) is a forum for coordinating international activities in setting new standards and rules for the global financial sector to promote global financial stability, yet a major issue in this regard is the question of how non-members of the G-20 are engaged in the G-20 processes. The current policy brief explores this issue in relation to Africa, and discusses how effectively Africa’s interests and concerns are directly or indirectly addressed in the G-20 processes.

Currently South Africa is the only African member of the G-20. However, there are five major initiatives of the G-20 in the areas of financial regulation and financial development, and each of these initiatives has specific objectives that are relevant for African economies. Nonetheless, there are few references to specific African concerns in G-20 documents on financial issues.

Consequently, the paper recommends that:

• the G-20 regulatory processes have to take into account the specific circumstances of African countries for financial development and adopting international financial regulations
• African countries, with the help of the Financial Stability Board (FSB) and other institutions should establish joint monitoring processes to assess the impact of the new G-20 regulatory framework on African economies
• the institutional framework for developing African positions related to financial stability and financial systems reform needs to be strengthened through greater inclusiveness and active participation of members in order to have a substantial impact on G-20 processes