Financial sector development and reform
Asad Alam, Country Director for South Africa and Ambassador Christian Meuwly
World Bank Group and Swiss State Secretariat for Economic Affairs to support South Africa on financial sector development and reform
PRETORIA, July 22, 2014 — The World Bank Group and the Swiss State Secretariat for Economic Affairs (SECO) today signed an agreement for a USD 4.12 million multi-donor Trust Fund program. The four year program will support efforts by South Africa to strengthen its financial regulatory reform agenda, deepen its capital markets and develop an appropriate framework to support long-term infrastructure finance in support of the National Development Plan.
This Trust Fund program will also help facilitate access to finance for the financially excluded population as well as small and medium-sized enterprises. The program will provide a combination of analytical work, policy advice and technical assistance to the country.
“Financial sector development and specifically financial inclusion is a government priority. We look forward to this collaboration which will provide international best practice and take forward our plan to improve the regulatory environment in order for the financial sector to better serve the country’s needs. This collaboration will also include the private sector, donors, civil society, and academia,” said Ismail Momoniat, Deputy Director General (Tax and Financial Sector Policy) at National Treasury.
Developed in close coordination with the South African National Treasury, the South African Reserve Bank, the Financial Services Board, and the Financial Intelligence Center, the program is fully aligned with National Treasury’s Red Book A Safer Financial Sector to Serve South Africa Better and the Twin Peaks financial regulatory reform agenda as well as the Government's priority to enhance financial inclusion.
Activities supported by this program are related to crisis management and resolution; market conduct regulation and supervision; capital markets development and regulation; the anti-money laundering/combating the financing of terrorism regulatory framework; innovative retail payment instruments and delivery channels; small and medium enterprise finance; debt rehabilitation and insolvency provisions for individuals.
SECO is part of the Swiss Federal Department of Economic Affairs, Education and Research and supports measures in economic and financial policy, urban infrastructure and utilities, private sector and entrepreneurship, sustainable trade, as well as climate-friendly growth.
“Switzerland has a strong record of experiences and good practice to share when it comes to a stable and well-developed financial sector and anti-money laundering. The promotion of innovative products, delivery channels and the further development of access to finance for small and medium-sized enterprises are key areas of Switzerland’s Private Sector Development activities. Switzerland also assists in improving the regulatory framework conditions for financial stability and supervision as well as in supporting the development of capital market and financial infrastructure. These programs are implemented through the State Secretariat for Economic Affairs SECO and its Economic Cooperation and Development Division.” said H.E. Christian Meuwly, Ambassador, Switzerland.
The program also links strongly to the World Bank Group’s goal of achieving Universal Financial Access globally by 2020 and is in line with the Group’s Country Partnership Strategy for South Africa which aims to support South Africa reduce inequality and promote investments.
"Financial sector development matters for growth and poverty reduction and financial inclusion is an important component for promoting entrepreneurship and reducing inequality in access to finance,” said Asad Alam, Country Director for South Africa. “This technical assistance program is an important part of the World Bank Group's Country Partnership Strategy and supports the Bank's twin goals of reducing extreme poverty and promoting shared prosperity".
This trust fund is the latest in the growing partnership between the World Bank Group and SECO to support South Africa's development priorities. This complements the ongoing collaboration on urban development.
Embassy of Switzerland, Pretoria