Financial institution's response to crisis is inadequate

Monday, August 17, 2009

Durban - The capacity of multilateral financial institutions to respond to the global economic crisis has been inadequate, says President Jacob Zuma.

Speaking at the International Statistical Institute's conference on Sunday evening, the President said a sustainable, longer term response needed to be pursued through the United Nations, International Monetary Fund, World Bank and other multilateral institutions.

South Africa has in the past called for a significant increase in resources for these institutions, and an increase in the representation of developing countries. This would enable these institutions to provide better forecasting, planning, monitoring and evaluation.

"This will no doubt include efficient statistical data gathering and analysis to assist recovery, especially in the developing world."

The economic crisis poses serious dangers to the development of low income countries, particularly in Africa.

Demand for African exports has dropped, investment flows have declined, the cost of borrowing has increased and remittances from Africans abroad are expected to decrease.

"Unless decisive action is taken, the crisis may set back recent economic and social progress on the continent, including progress towards the Millennium Development Goals," said Mr Zuma.

South Africa has undertaken measures to minimise the impact of the crisis, including revising the fiscal stimulus packages, expenditure, targeting, assistance to key sectors and strengthening financial regulation.

This was the first time in the 122-year-old history of the International Statistical Institute that the conference took place on sub-Saharan African soil.

President Zuma said this was an indication that the institute was committed to African and world statistical progress and to supporting much-needed development in the world.

The week-long summit has attracted thousands of the world's top statistical minds to share knowledge, experience and best practices with private, public, research and educational institutions, forming new collaborations on a national and international level.