Central banks of the Southern African Development Community (SADC) are assessing challenges related to public debt, inflation, and external shocks amid mounting fiscal pressures, climate risks, and cybersecurity threats. The issues dominated the 63rd meeting of the SADC Committee of Central Bank Governors, held in Luanda.

Opening the meeting, Lesetja Kganyago, Governor of the South African Reserve Bank (SARB) and chair of the committee, called for strengthened regional preparedness and cooperation to address these threats.

Kganyago pointed to the effects of the conflict in the Middle East on fertiliser costs and availability, as well as risks associated with the El Niño climate phenomenon. He also stressed the importance of improving cross-border payments to deepen economic integration across the region.

Manuel Tiago Dias, Governor of the Banco Nacional de Angola (BNA), told reporters on the sidelines that the meeting provided an opportunity to review macroeconomic convergence indicators and share experiences among member states.

Public debt emerged as one of the central concerns, given its implications for price stability and governments’ ability to meet their financial obligations.

“Within the framework of the various macroeconomic convergence indicators, there was extensive reflection on the ratio of debt to gross domestic product (GDP),” Tiago Dias said.

The BNA governor added that central banks would maintain dialogue with their respective governments on a possible revision of the public debt convergence criterion. He noted that the current reference ceiling stands at 60% of GDP and that any amendment would require approval from SADC member governments.

On inflation, the BNA governor underscored price stability as a core priority for the region’s central banks. In Angola, the year-on-year inflation rate stood at 8.43% in September, remaining above the 3% to 7% reference band established under the regional convergence criteria.

Despite Angola having already brought inflation into single-digit territory, Tiago Dias argued that it was necessary to “continue working to bring inflation below 7%”, moving the country closer to its regional targets.

Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/?p=558450