Trade conflicts benefit no one, as there are no winners. That was the message from the Chairperson of the International Monetary and Financial Committee (IMFC), the top policy steering committee of the International Monetary Fund (IMF), Lesetja Kganyago, who was addressing the media at the conclusion of their deliberations in Washington Sunday.
The United States has been calling out what it terms unfair global trade practices which US and global growth, but the IMFC stresses that increasing trade is critical to broad-based economic growth. The question of land expropriation without compensation was also put to Kganyago, who is the governor of the South African Reserve Bank (SARB).
South Africa has proposed to expropriate land without compensation to redress what it describes as historical injustices when the land of the indigenous people were seized from them by the white European settlers.
It was Kganyago’s first stint as head of the IMFC and he gave an uncompromising message despite pressure from the largest economy in the world. The bottom line here is that trade tensions are not to the benefit of anyone. There can never if there is a trade conflict there could never be winners,” he said.
“We could all only be losers, and it is within that context that it is important that, as a global community, we keep trade open, we ensure that we work within the multilateral system that we have to make sure that if there are disputes, that those disputes are resolved and I think that is for me what is going to be crucial.
Asked if an African proverb about elephants fighting while trampling the grass below might have helped in explaining the ramifications of a trade war to US Treasury Secretary Steve Mnuchin, Kganyago answered: I don’t know what Mr Mnuchin had said, the communique that we have, that we have released to the extent that it talks about trade, it had been signed off by the entire membership.
“So, when we say that there are rising trade tensions, it is the collective assessment of the committee. African proverbs are always very nice, but it will be very difficult to explain an African proverb from here.
South Africa is among the most unequal societies anywhere in the world, and part of addressing that inequity, the country is engaged in the possibility of land expropriation without compensation.
I would simply say that we have mentioned many times over the respect for the rule of law, and I would suspect that South Africa is being a very civilized, sophisticated country when it comes to the law; the rule of law will also be binding on all � and I would just maybe use a proverb. I have no idea whether it’s an African proverb or not, but my recollection is it goes something like ‘Trust grows at the speed of a coconut tree, and falls at the speed of a coconut’, said IMF Managing Director Christine Lagarde.
The IMFC is comprised of 24 member states drawn from a pool of 189 IMF Governors and its meeting here at the weekend was held during the annual Spring meetings here of the IMF and ther World Bank. The autumn meetings of the IMF and World Bank will take place in Bali, Indonesia, in October.
Source: NAM NEWS NETWORK