23 Oct 2017

Bank of Botswana (BoB) governor, Mr Moses Pelaelo participated in the annual meetings of the International Monetary Fund (IMF) and World Bank Group (WBG) in Washington DC (USA) from October 9-16.

A press release from the BoB states that in his capacity as governor for Botswana at the IMF, the governor attended the combined plenary addressed by the managing director of the IMF, Ms Christine Lagarde and the president of the WBG, Dr Jim Kim.

It says he also took part in the meetings of the International Monetary Fund and financial committee, the IMF’s Africa group one constituency which comprises 23 Sub-Saharan countries, the Commonwealth Central Bank governors and the Macroeconomic and Financial Management Institute (MEFMI) of Eastern and Southern Africa board of governors.

The release states that the meetings deliberated on, among others, recent economic and financial developments, prospects for global economic growth, challenges and related policy responses.

It was observed that after disappointing growth over the past few years and market turbulence, global economic activity was strengthening.

However, it was noted that the recovery is not yet complete, with below-target inflation and weak wage growth in most advanced economies, while output was below potential in many countries.

The release further says global growth is projected to increase from 3.2 per cent in 2016 to 3.6 per cent in 2017 and 3.7 per cent in 2018.

The respective growth rates for Sub-Saharan Africa are 1.4 per cent for 2016, 2.6 per cent for 2017 and 3.4 per cent for 2018.

It is also projected that a supportive global financial environment, rapid technological progress as well as stronger consumer and business confidence would add impetus to international trade and broad-based, stronger global economic activity, states the release.

It says, however, there are downside risks to stronger economic recovery in the medium term, including the impact of natural disasters, climate change, geopolitical tensions, political and economic policy uncertainty, rising protectionist sentiment in some high-income countries, weak governance, corruption and persistence of macroeconomic imbalances.

Governors, states the release, emphasised that a cooperative multilateral framework for trade and financial integration has served countries well and should be sustained in order to produce shared economic benefits.

In addition, prospects for inclusive growth and resilience against downside risks continue to be dependent on implementation of key structural reforms and harnessing the benefits of technological progress to raise productivity as well as maintenance of prudent macroeconomic and financial policies.

Furthermore, there is need for policymakers to tackle excessive income inequality, address impediments to economic opportunities for the youth and women as well as engage on multilateral frameworks to respond to the challenges of natural disasters, trade restrictions and cybercrime.

Overall, it was emphasised that the current favourable global economic environment provided a window of opportunity for countries to implement the structural and fiscal reforms required for greater resilience, enhancing productivity and investment, with particular emphasis on education, health and social safety nets for a more inclusive and sustainable growth.

The governor also attended several briefings and seminars, among others, presentation on the African economic outlook. ENDS