Central Banks

Central Bank Independence and Institution Building During the Neo-Liberal Era: The Case of Bank of Zambia

This blog post largely derives from a recent study entitled Bank of Zambia’s Autonomy Amidst Political Turnovers in Zambia, which investigated whether BOZ could effectively deliver on its mandate given the context of political interferences arising out of Zambia’s competitive clientelist democracy. That study concluded that, over time, BOZ had enshrined its independence in the law and had been quite effective at delivering on its mandate to stabilize prices and develop the financial system as required in a market economy.

The Central Bank’s Financial Stability Mandate: Sizing up Twin Peaks in South Africa

It is proposed that South Africa as a developing country needs to have a central bank that has the semblance of a developmental central bank, and that takes care of consumers, different than the orthodox, neoliberal central bank that focuses on price stability and lowering of inflation and expect market forces to protect consumers. The Twin Peaks model of financial regulation where the central bank is explicitly appointed as the guardian of financial stability, could be a small step on the way of the SARB becoming such semblance of a developmental central bank.

The Bare Bones of the Bank of Namibia Act of 2020

This opinion piece aims to ascertain the extent to which the new Bank of Namibia Act 1 of 2020 (the Act) imports the neoliberal rules of central banking and it also assesses the level of departure, if any, from the conventional central bank mandates couched in law. The piece further highlights the domestication of the rules of the Central Bank Model Law adopted by the Southern African Development Community (SADC).

Central Bank of Ghana: A Timorous Soul or a Bold Spirit

The ailing financial sector in Ghana necessitated an immediate pragmatic response to realign and reposition the financial sector back to its glory days. Depositors’ monies are mostly squandered or bolted with by directors and managers of financial institutions in Ghana. The recent clean-up in the financial sector has awakened uproars from some Ghanaians, notable amongst them are the customers of the affected financial institutions. While some vowed to boycott the 2020 elections, others instituted a civil action in court on the grounds of negligence against the central bank. It will be intriguing to know the legal principles for adjudicating this matter in the high court, whether private law principles under tort law (on the basis of which the customers have sued BoG), or public law principles under administrative law (which seems more appropriate for a public body). With the extent of insolvency, licensing irregularities and insufficient minimum capital requirements among financial institutions, the greatest fatherly role played by BoG was not to spare the rod to spoil the child in its quest to salvage the financial sector.

International Economic Law and Central Banks in Africa: Toward a Progressive Pro-Development Approach

Africa’s regional central banks, and the projects of monetary coordination and monetary union they oversee, arise directly out of treaty frameworks. These frameworks provide vital opportunities for calibrating these policy objectives in the form of legal and institutional design. The goal must be to ascertain the components of a progressive, pro-development approach that will seek to balance the objective of financial stability with the objective of maintaining sufficient macroeconomic policy space, and the objective of central bank independence with the objective of accountability to the public interest.

Symposium Introduction: What Makes the Central Bank So Central?

May 24, 2020

It is the segment of the news bulletin that many viewers skip, the section of the newspaper that many readers skim, the panel of the law conference during which many listeners in the audience yarn. And yet few things affect our ability to eke out a living as drastically as central banking.

Thirteenth Sovereign Debt News Update: World Bank, Rating Agencies and Regional Banks in Context

The African Sovereign Debt Justice Network brings to you an update of African sovereign debt news and updates on events and happenings on and about Africa that reveal how sovereign debt issues are engaged by the various stakeholders.

An African perspective of fiscal policies and debt management in the wake of the COVID-19 Pandemic

African countries are very diverse in terms of their current debt situation, debt management practices and government securities markets. Debt management is, therefore, a vital component of the appropriate fiscal policy for the management of the negative impact of COVID-19 on the economy of African countries. However, debt management alone cannot solve structural problems and macroeconomic imbalances. Rather, a holistic approach including an appropriate debt level, debt restructuring, and maintenance of healthy domestic and continental forex markets can contribute to preventing sovereign insolvency despite the negative effects of this pandemic to African countries.

Global South International Financial Institutions and COVID-19 Response: Utilising Innovative Financing Solutions now and after the Pandemic

Financial institutions should focus on the positive opportunities and learning experiences from this pandemic and plan how they will help their member states adjust to the effects of COVID-19 and attain sustainable development thereafter. This step will be in line with the World Bank’s advice on planning for the economic recovery from COVID-19, in the bid for nations to restart their economic engines and build back stronger and better in the short term and longer term.

Why central banks need to take human rights more seriously

This analysis demonstrates three key points. First, it is becoming untenable for central banks to avoid incorporating their human rights impacts into their decision-making and operations. Second, a human rights approach offers central banks a new tool for understanding the true costs and benefits of their operations. Third, central banks can meet their human rights responsibilities without compromising the independence they need to meet their monetary and financial responsibilities.