Statement by the Deputy Minister of Finance of the Republic of South Africa, H.E. Mr. David Masondo (Alternate Governor for South Africa)
President Marcos Troyjo and executive management team,
Fellow Members of the Board of Governors,
Members of the Board of Directors,
colleagues and friends,
Good morning, good afternoon, and good evening.
- This year marks the New Development Bank’s Seventh Annual Meeting since inception and there is ample to reflect on and to be proud of. We take pride in that we have successfully completed the first phase of the New Development Bank’s General Strategy which spanned from 2017 – 2021 and we have indeed learned some valuable lessons along the way. South Africa is proud to be part of this novel institution – created by emerging markets and developing economies. The NBD has quickly risen to the level of its global peers and we look forward to the continued partnership that contributes to the global sustainable development agenda.
- Our achievements are many. Allow me to highlight just a few: firstly – though each of us faced varied and challenging circumstances – we managed to honour our financial commitments in respect of the payment of the paid-in portion of our capital subscription. Secondly, there was a determination from the onset to establish a leaner, more efficient and less bureaucratic MDB, which has been demonstrated through the speed of our loan approvals. The Bank has approved nearly USD 30 billion worth of investments in our member countries. Thirdly, we have opened the doors to new members, which will catapult us to becoming a premier global MDB. As others, I wish to welcome our new members, Bangladesh, and United Arab Emirates, to their first Annual Board of Governors Meeting.
- As conceptualised, the Bank has been very responsive to its members. For example, in the midst of the COVID-19 Pandemic, the NDB remained agile and reacted swiftly to support its members. The Policy for Fast-track Emergency Response to COVID-19, responded accurately to the urgent needs of its members. Within a month, emergency sovereign loans for members were under process to facilitate smoother approval and disbursement.
- With the limited policy space, the NDB has played a critical role in supporting our specific national development agendas as member countries and generally, in achieving the United Nation’s Sustainable Development Goals (SGDs). South Africa is also doing its parts in supporting economic recovery. We have launched our Economic Reconstruction and Recovery Plan which has three phases: I) a comprehensive health response to save lives and curb the spread II) provide interventions to reform and restore the economy and III) building a sustainable, resilient and inclusive economy. To facilitate the reforms and operationalise this plan, government embarked on Operation Vulindlela – in October 2020 to unblock obstacles to microeconomic reforms and cut red tape to investment. Of the 26 reforms we are monitoring, 8 are completed and 11 are on track. The remaining will be commenced soon.
- With the shift in financial markets, evolving public policy priorities, and economic recovery from the pandemic, innovative financing for development is a key priority that requires urgent cooperation and collaboration. Innovative financing is an essential tool for the delivery of SDGs and the commitments in respect of the Paris Climate Agreement. South Africa is pleased with US$3.0 billion expression of interest received from the Bank to support our climate related investment in the next 3 – 5 years, as we reaffirms our COP26 declaration.
- The Bank’s increased support to our development priorities, such as the Eskom Just Transition Project are welcomed. In addition, we implore the Bank to optimize blended project finance and innovative green finance to drive development impact in member countries. We call for the Bank to enhance its presence in the local capital market and provide loans in local currency, as well as strengthen sub-national lending that would focus on promoting economic growth and development at a regional/district level.
- We encourage the Bank to facilitate more investment in new sources of zero-carbon energy, promote more efficient localized food production and water preservation to promote green, resilient, and inclusive development. As we do this, we need to be more efficient with the use of our resources. Our regional offices need to be properly resourced and supported to assist us deliver on our goals.
- Lastly, the principal goal of optimizing development impact – the theme of this annual meeting – is to improve overall sustainability. Environmental, social, economic, and energy resources sustainability should be enshrined in the key mandate and objective of the Bank’s 2nd NDB General Strategy for 2022-2026.