Latest news with #G20FinanceTrack
IOL News
5 days ago
- Business
- IOL News
G20 Finance Track meetings highlight global economic challenges
Key note addresses from Minister of Finance, Enoch Godongwana, Dr Duncan Pieterse, Director-General of the National Treasury, and Lesetja Kganyago, the governor of the South African Reserve Bank highlighted the global uncertainty and challenges faced by developing and African countries. Image: Yogashen Pillay The G20 Finance Track meetings that took place in Zimbali North of Durban entered its final day on Friday. Key note addresses from Minister of Finance, Enoch Godongwana, Dr Duncan Pieterse, Director-General of the National Treasury, and Lesetja Kganyago, the governor of the South African Reserve Bank highlighted the global uncertainty and challenges faced by developing and African countries. Pieterse on the opening day of the G20 Finance Track meetings said that we are meeting at a moment of ongoing uncertainty in the global economy. 'While there are signs of resilience in some areas, various challenges remain: uneven growth trajectories, elevated debt levels, persistent inflationary pressures, and the complex implications of tightening financial conditions.' Pieterse added that at the same time, various long-term transitions including digitalisation, climate finance and demographic shifts are reshaping the foundations of our economies. 'The multilateral system is being tested, and our collective ability to respond, will shape the pace of our recovery, but also the prospects for inclusive and sustainable development." Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ ''As the G20, we have the responsibility to demonstrate leadership, and our Presidency places a very strong emphasis on strengthening the role of the G20 in delivering concrete solutions, fostering a more stable and effective and resilient international financial architecture, enhancing debt sustainability, addressing liquidity challenges, as well as strengthening multilateral development banks, and ensuring financing for development,' added Pieterse. Godongwana in his opening remarks at the Finance Ministers & Central Bank Governors (FMCBG) Meeting said that we meet at a time of fragile global economic growth. 'While inflation is gradually moderating and financial conditions have started to stabilise in some regions, uncertainty continues to weigh heavily on global growth prospects. Rising trade barriers, persistent global imbalances and new geopolitical risks are significant concerns.' Godongwana added that many developing countries, especially in Africa, remain burdened by high and rising debt vulnerabilities, constrained fiscal space, and a high cost of capital that limits their ability to invest in their people and their futures. 'Technological shifts—especially in artificial intelligence and digital finance—offer tremendous potential but also demand robust governance and coordinated action to harness the opportunities, mitigate risks such as job displacement, and bridge the digital divide towards inclusive growth. At the same time, climate-related shocks and extreme weather events are increasing in frequency and severity worldwide, impacting lives, livelihoods, and macroeconomic stability,' said Godongwana. Godongwana added that in the face of these complex challenges, the G20 must remain a source of strategic global leadership, cooperation, and action. 'We must extend our efforts, if we are to reach our true potential as a collective, to enable us to deal decisively with the economic, environmental, developmental and social challenges that plague especially Africa, low-income countries in other regions and small developing states.' Kganyago warned of the headwinds for the global economy as forecasts have been revised lower. 'Risks to the outlook have been tilted to the downside, while inflation has eased across countries, it remains higher than desired. Central banks have to skillfully navigate what uncertainty means for their financial stability mandates,' Kganyago said. 'These developments are unfolding under the backdrop of elevated debt and emerging risks on financial sustainability. According to the Organisation for Economic Co-operation and Development (OECD), the world has shifted to a new debt paradigm. Governments and companies are borrowing more than $10 trillion (R179 trillion) compared to the pre-COVID-19 period.' Meanwhile, Greenpeace Africa has called on G20 host and South African President Ramaphosa to push ahead on accelerating efforts to impose a wealth tax on the world's billionaires and to support the UN Tax Convention for new and fair global tax rules. Cynthia Moyo, Lead Campaigner, Greenpeace Africa, said that it's outrageous that billionaires keep getting richer from a broken global tax system while millions across Africa and the world are driven deeper into poverty and climate chaos. BUSINESS REPORT
The Citizen
7 days ago
- Business
- The Citizen
AI powers Sars efficiencies, says Kieswetter at G20 Zimbali meet
But regulators caution against unchecked risk. Edward Kieswetter says Sars has used machine learning and AI to assess 65% of taxpayers without requiring them to submit a tax return. Picture: Moneyweb The South African Revenue Service (Sars) has had great success with its tax collection efforts, thanks to artificial intelligence (AI) – and the absence of overly rigid regulation of new technology. 'We are on a path that has no [precedent] and therefore one must balance the development of policy and practice,' said Sars Commissioner Edward Kieswetter on Thursday, when representatives of central banks, the Financial Sector Conduct Authority (FSCA), and the Organisation for Economic Co-operation and Development (OECD) took part in a roundtable discussion about the role of AI in financial systems. The discussion was a side event of the G20 Finance Track meeting, which is taking place at the Zimbali Resort in KwaZulu-Natal. 'If policy gets too far ahead of practice, we may in fact suppress the experimentation and the exploration of new technology,' Kieswetter notes. He says Sars has already used machine learning and AI to assess 65% of taxpayers – nine days into the tax filing season – without requiring them to submit a tax return. 'We've drawn only on third-party data and used machine learning, algorithms, and AI to perform the assessment and fraud risk detection.' Twenty years ago, it took Sars six months to assess six million taxpayers. 'This year, they will not have to file. And for the two million who choose to file, they will receive an assessment in under five seconds.' Within the first nine days of the 2025 tax season, Sars had already paid out R12 billion in refunds and raised R3.5 billion in assessments. Kieswetter notes that the use of AI also helped Sars prevent R5.5 billion in impermissible refunds. ALSO READ: Sars makes changes to eFiling for easy use 'New and complex risks' Opening the roundtable discussion on Thursday, South African Reserve Bank Governor Lesetja Kganyago warned that while AI holds significant potential for financial innovation and inclusion, it also introduces new and complex risks that make supervision challenging. 'Our mandate tends to converge on key fundamentals to safeguard financial stability, to uphold efficient operation of financial markets, and to deliver consumer protection. These are not abstracts, they are tangible promises we've made to our constituents.' Kganyago added that AI brings 'a profound duality – a landscape of immense opportunity interwoven with significant risk'. On one hand, it can enhance risk detection at both the institutional and system-wide levels, improve consumer credit scoring, and deepen inclusion. But these same tools can also amplify market shocks and perpetuate bias. Kganyago emphasised the need for regulators to remain committed to core mandates while adapting to new technologies. 'Technology will change. The tools we use will evolve beyond recognition. But our mandate remains constant – ensuring stability in the value of the monies of the people who are the users of the financial system.' ALSO READ: Sars records increase in taxpayers who filed returns AI adoption in South Africa's financial sector Katherine Gibson, divisional head at the FSCA, provided new insights from a soon-to-be-published joint survey conducted with the Prudential Authority. The survey covered nearly 2 000 institutions across banking, payments, insurance, fintech and more, to gauge how AI is being used across South Africa's financial sector. 'It reveals a sector that is cautiously optimistic about AI's potential, and, as expected, a range in the pace of adoption,' according to Gibson. In 2024, global financial sector investment in AI exceeded $50 billion (R892.7 billion), with projections to surpass $150 billion (R2.7 trillion) annually by 2028. She says locally, fintechs are leading AI uptake, with two-thirds already deploying it. Over 50% of banks have followed suit, while insurance and lending sectors are more reserved, with adoption rates under 10%. 'Banks are investing almost 20 times more than the rest of the sector.' ALSO READ: Economists say they are confident in Sars However, she stresses that with innovation comes responsibility. 'We must ensure that hyper-personalisation does not become a byword for hyper-exploitation and that generative AI chatbots are not mis-selling complex products to consumers who do not understand them.' She warns that some institutions have not implemented transparency safeguards. 'About one fifth of SA institutions reported not using any explainability models or methods for their AI models, which raises questions about transparency and accountability and consumer protection.' For many institutions, South Africa's data protection law (Popia) is seen as the top constraint to AI adoption. Gibson disagrees with the notion that regulation is a barrier. 'These are not barriers to innovation, but essential guardrails to ensure tech serves the public good.' ALSO READ: Sars gets AI to sniff out tax evaders OECD flags risk of market volatility OECD Secretary-General Mathias Cormann warns that generative AI brings growing threats of financial fraud, scams and cyber attacks – particularly as global financial markets become increasingly connected through similar AI tools. 'The use of AI in financial markets could also increase market volatility for a significant number of participants that rely on similar AI models, leading to a convergence of trade and feedback loops between models,' Cormann cautions. The OECD's most recent risk monitor found that AI use in credit assessments and insurance underwriting can compromise privacy and lead to discrimination. He says competition, rather than concentration, would be key to securing the benefits of AI in finance. This article was republished from Moneyweb. Read the original here.
The Citizen
16-07-2025
- Business
- The Citizen
Call to ‘tax the rich' as global finance ministers meet in Zimbali
Working group says National Treasury should adopt measures that do not disproportionately impact working-class South Africans. The Tax Justice Working Group calls for progressive positions on international tax reform while SA hosts the G20 presidency. Picture: iStock A grouping of civil society organisations, trade unionists and activists is calling on the South African government to take action to 'tax the rich' and tackle corporate tax abuse. The South African Tax Justice Working Group is represented by organisations such as Cosatu, Oxfam, and the Institute for Economic Justice (IEJ). It made the call ahead of the G20 Finance Track meeting currently underway at the Zimbali Resort on KZN's North Coast. 'This week, as finance ministers of the G20 gather in KwaZulu-Natal, we call on the South African government to match its global commitments with bold domestic action to … stop tax abuse by multinational corporations,' it stated. The taxation of high-net-worth individuals has become a growing focus in international policy discussions. A study commissioned by the G20 and led by economist Gabriel Zucman estimates that a 2% tax on the wealth of the world's 3 000 wealthiest billionaires could generate between $200 billion (R3.6 trillion) and $250 billion (R4.5 trillion) annually. Read more Common pitfalls to avoid this tax season ALSO READ: Will South Africa's rich pay wealth tax or find ways to avoid it? The issue gained further traction at the G20 Summit in Rio de Janeiro, Brazil, in November 2024. Early in July this year, Spain and Brazil launched a joint initiative to promote higher global taxation of the ultra-wealthy. The proposal was formally introduced at the United Nations 4th International Conference on Financing for Development, held in Sevilla, Spain, and is expected to shape upcoming negotiations on international tax cooperation. 'South Africa joined the Sevilla Platform for Action [SPA] on taxing high-net-worth individuals at the conference, which signals a significant commitment to fairer taxation of the wealthy,' the tax working group notes. ALSO READ: Budget 2025: Is wealth tax coming for South Africa's rich? In a statement issued after the launch in Spain, Oxfam noted that Spain, Brazil and South Africa had taken an important step in 'forging an alliance … to show political will for taxation of the super-rich'. 'Now other countries must follow their lead and join forces,' Oxfam tax justice policy lead Susana Ruiz said, adding that COP30 in Brazil and the G20 in South Africa are key opportunities for international cooperation to tax the super-rich. ALSO READ: Many wealthy taxpayers are leaving SA due to increasingly high taxes Working group declaration The South African Tax Justice Working Group also adopted a declaration calling on government to champion progressive positions on international tax reform in its work as the G20 presidency. 'South Africa has not only the potential to play a leading role in [implementing a wealth tax], but also stands to benefit due to the reality of unprecedented inequality within this country.' It said National Treasury should take advantage of this international momentum to advance a progressive taxation agenda and work towards a wealth tax and other proposals that do not disproportionately impact working-class South Africans, unlike value-added tax (Vat) and other regressive measures. In May, shortly before tabling the third iteration of South Africa's 2025 Budget, Finance Minister Enoch Godongwana told parliament he does not support the idea of a wealth tax to address the budget shortfall, arguing that wealthy individuals in South Africa already contribute through various existing taxes. This article was republished from Moneyweb. Read the original here.
The Star
15-07-2025
- Business
- The Star
SARB deputy governor warns of rising protectionism at G20 meeting
JOHANNESBURG, July 15 (Xinhua) -- Rashad Cassim, deputy governor of the South African Reserve Bank (SARB), on Tuesday voiced concern about rising protectionism in the world during an ongoing meeting of the Group of Twenty (G20) members. "There are concerns about whether some countries are adopting more protectionist policies than others. The key is to create an environment that allows for open dialogue on trade matters," Cassim said during the fourth G20 Finance and Central Bank Deputies Meeting held in Durban. The July G20 Finance Track meetings kicked off on Monday in Zimbali, KwaZulu-Natal, with the two-day Finance and Central Bank Deputies Meeting being the first session. According to Cassim, the G20 Finance Track meetings would address a range of pressing global matters, with a key challenge being the identification of the sources of imbalances in the global economy. "Speaking as a central banker, uncertainty has terrible effects. It fuels inflationary concerns. At this stage, however, it is the country imposing the tariffs that must contend with inflation, rather than those on the receiving end," he added. Following the fourth G20 Finance and Central Bank Deputies meeting from Monday to Tuesday, the Finance Ministers and Central Bank Governors gathering will be held from Thursday to Friday.
The South African
14-07-2025
- Business
- The South African
G20's ability to respond to multilateral tests 'critical'
The G20 countries' ability to respond collectively to mounting challenges facing the multilateral system will determine both the speed of global recovery and the future of sustainable development. This is according to National Treasury Director-General, Dr Duncan Pieterse, who delivered remarks at the opening session of the G20 Finance Track meetings being held in KwaZulu-Natal this week. 'The multilateral system is being tested, and our collective ability to respond, will shape the pace of our recovery, but also the prospects for inclusive and sustainable development. 'As the G20, we have the responsibility to demonstrate leadership, and our Presidency places a very strong emphasis on strengthening the role of the G20 in delivering concrete solutions, fostering a more stable and effective and resilient international financial architecture, enhancing debt sustainability, addressing liquidity challenges, as well as strengthening multilateral development banks, and ensuring financing for development,' Pieterse said. He added that the meetings take place at a time of heightened global economic uncertainty. 'While there are signs of resilience in some areas, various challenges remain: uneven growth trajectories, elevated debt levels, persistent inflationary pressures, and the complex implications of tightening financial conditions. 'At the same time, various long-term transitions including digitalisation, climate finance and demographic shifts are reshaping the foundations of our economies,' the DG noted. Pieterse explained that this week, sessions have been dedicated in line with 'our commitment to deepen policy dialogue at the Deputies level'. 'These discussions are instrumental in shaping the outcomes of the Finance Track, and reaffirming our commitment as the Presidency to Solidarity, Equality, Sustainability,' he said. On Monday, the sessions kicked off with an update from the Council of Europe Development Bank on its monitoring and reporting framework. '[This framework] is a critical tool for tackling the implementation of the G20 MDB roadmap as it enables MDBs to assess how they are working better as a system, enhancing their effectiveness and maximising developmental impact. 'This will be followed by a pandemic response financing simulation exercise that will be facilitated by the World Bank and the objective of this exercise is to simulate a coordinated pandemic response financing scenario, enabling participants to explore practical mechanisms for mobilising and deploying resources rapidly and effectively during a global health emergency,' he said. On Tuesday, the International Monetary Fund and the World Bank will give updates on the global sovereign debt roundtable. 'This discussion is geared towards promoting information exchange between the GSDR and the G20 to enhance the effectiveness of both platforms while respecting the distinct roles. 'Significant progress has been made on the GSDR work, including the publication of the GSDR playbook on sovereign debt restructurings during the Spring Meetings in April, and another important milestone that was achieved was the publication of a G20 note on the steps of debt restructuring under the common framework,' Pieterse explained. On the same day, the Chairperson of the Africa Expert Panel, led by former Minister of Finance for South Africa, Trevor Manuel, will give an update on the work of the panel. '[This] section will provide Deputies with an overview of the work of the Panel, which…aims to advance Africa's collective development interest within the G20 Finance Track. We will be getting an update from Minister Manuel on this so that we can ensure that we align African priorities with the global economic reform efforts that we are discussing in the G20,' he said. Over the next two days, the delegates will have sessions dedicated to the drafting of a communique. 'We really want to thank the G20 members for very constructive inputs and engagements thus far, which started last week virtually, and we believe that those engagements have set a very strong foundation for our discussions over the next two days. 'We are very pleased with the collaborative spirit shown during the virtual discussions, and we believe that we are able to achieve agreement in most of the areas which will enable us to provide the Finance Ministers and Central Bank Governors with an opportunity to achieve the first Communique under South Africa's Presidency,' Pieterse concluded. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
