Day: April 20, 2022

Some of the worst flooding in South Africa’s history has left more than 400 people dead and some 40,000 displaced, dealing a devastating blow to the eastern city of Durban, which has a seaport that has also been badly affected.

With the port not fully functioning, there are supply chain concerns and China — South Africa’s biggest trading partner — and other nations, are likely to see their imports and exports disrupted.

Earlier this week, South African President Cyril Ramaphosa declared a national state of disaster because of the flooding — which he blames on climate change but which some critics blame on poor infrastructure and the fact that most of the people affected were living in makeshift shacks in informal settlements.

Ramaphosa stressed the importance of quickly fixing the situation at the port, saying, “The Port of Durban — which is one of the largest and busiest shipping terminals on the continent and which is vital to our country’s economy — has been severely affected.”

The road to the port, which handles some 13,000 heavy vehicles a day, has been severely damaged, he added.

On Tuesday, Public Enterprises Minister Pravin Gordhan Pravin Gordhan visited the port, which has reopened, and concluded it would take more a week to clear some backlogs. The rail network to the site had been affected by landslides and still needs to be repaired, he said, adding that 9,000 containers have accumulated at the port and would be cleared in the next nine days.

Logs and debris also ended up in the harbor due to the floods, which he said had disrupted shipping.

One of the countries likely to be affected by problems at the port is China, said Cobus van Staden, senior China-Africa researcher at the South African Institute of International Affairs.

“In relation to the situation in Durban, it’s very serious for the whole of China-Africa trade, rather than just for South Africa; this is because of the centrality of Durban port to Chinese exports,” he told VOA.

“About 20 percent of total China-Africa trade goes out through Durban and this includes resources like cobalt, copper and lithium coming from the Democratic Republic of Congo and Zimbabwe particularly,” he added.

Maersk, the world’s biggest container line, halted operations at the port last week and told VOA by email its warehouse had been affected and was still not operational. While vessel operations had resumed, the company said problems with road access were affecting all cargo entering or leaving the terminal.

“We continue to assess the damages and monitor the situation as it evolves, customers are being updated daily on the progress and the contingency plans so that we may get the supply chains moving again as quickly as possible,” it said.

Wandile Sihlobo, chief economist for the Agricultural Business Chamber of South Africa, told VOA he thought it would take some time before activities at the port were back to normal.

“There’s been great devastation by these excessive rains and it’s a major risk to commerce and all goods: automobile, agriculture and other sectors of the economy that are dependent on trade,” he said.

Source: Voice of America

Senior leaders of the United States, Canada and the United Kingdom walked out of a meeting of the Group of 20 major economies on Wednesday in protest of the G-20’s decision to allow Russian officials, including Finance Minister Anton Siluanov, to participate.

The U.S. and other members of the G-20 had called on Indonesia, which holds the rotating chair of the organization, to bar Russia from the meeting over its invasion of Ukraine. The fact that Russia was allowed to participate highlights the significant fractures within the organization in addressing the war in Ukraine.

Although Ukraine is not a member of the G-20, Ukrainian Foreign Minister Dmytro Kuleba and Finance Minister Serhiy Marchenko were invited to attend the meeting. In remarks at the beginning of the session, Kuleba vowed that Ukraine would not cede territory to Russia as part of peace negotiations. Both Kuleba and Marchenko joined the walkout.

In his remarks, Siluanov warned against politicizing dialogue among member states, saying that it might harm the global economy.

Major split

While the U.S., U.K., France, Germany, Japan and Canada — some of the largest members of the G-20 — have forcefully condemned Russia’s actions in Ukraine and fully participated in a regime of tough economic sanctions, many others have not. The latter include China, Indonesia, India and South Africa.

On Wednesday morning, Treasury officials told the Reuters news organization that Treasury Secretary Janet Yellen had spoken with Indonesian Finance Minister Sri Mulyani Indrawati the day before the meeting. In a statement, the department said, “Secretary Yellen firmly condemned Russia’s brutal invasion of Ukraine, and emphasized there will be no business-as-usual for Russia in the global economy.”

The statement continued: “Secretary Yellen emphasized that the United States will continue to work in solidarity with Indonesia to advance the important business of the G-20, including addressing the negative impacts of Russia’s invasion on the global economy.”

Yellen had signaled her intention to avoid meetings in which Russia participated in comments on April 7, when she reiterated U.S. President Joe Biden’s call to expel Russia from the organization.

On Wednesday, Canadian Deputy Prime Minister and Minister of Finance Chrystia Freeland tweeted, “This week’s meetings in Washington are about supporting the world economy — and Russia’s illegal invasion of Ukraine is a grave threat to the global economy. Russia should not be participating or included in these meetings.”

A plea for cooperation

The G-20 was founded in 1999, but it became a force on the world stage during the global economic crisis of 2008-09, when it served as the coordinating body for a series of policy responses that many economists credit with preventing far greater economic damage.

More recently, the group was central in the development of a plan to impose mandatory minimum taxes on international businesses to prevent a “race to the bottom” as countries competed to attract companies with ever-lower tax rates.

On Wednesday, International Monetary Fund Managing Director Kristalina Georgieva called on G-20 members to continue cooperating to address major global problems, calling the organization “crucial to sustain the momentum on collective efforts to deliver on global ambitions for the common good.”

She added, “We also recognize how interdependent we are … and it is so obvious that cooperation must and will continue.”

Future effectiveness questioned

Experts, however, are now concerned that the G-20 may struggle to lead on some of the key issues that its members have identified as important, including climate change and global food shortages, because of disagreements about Russia’s continued participation.

“We have a real need for a group like that, to sit down and try to come up with practical solutions,” Matthew Goodman, senior vice president for economics at the Center for Strategic and International Studies, told VOA. “But it’s very difficult to see how that’s going to happen under the current circumstances. There’s a substantial group that doesn’t want to work with Russia right now, and there’s another substantial group that isn’t willing to talk or agree to things without Russia at the table. So, it’s hard to see how you get out of that.”

Goodman, who helped organize G-20 summits during the Obama administration, said it was possible that there might be some “lowest common denominator” issues that the entire G-20 could agree on despite its internal divisions. But he wasn’t holding out much hope.

“It’s just hard to see how this group really delivers on anything,” he said.

Summit in doubt

Unlike the annual G-20 summit, which is normally attended by heads of state, Wednesday’s meeting in Washington involved member states’ finance ministers and central bank governors.

This year’s summit, scheduled for November, will be held in Bali, in recognition of Indonesia’s position as chair. Indonesian President Joko Widodo has indicated that Russian President Vladimir Putin will be welcome in Bali, prompting protests from other group members and suggestions that a boycott might take place.

Last month, Australian Prime Minister Scott Morrison said, “The idea of sitting around a table with Vladimir Putin, who the United States are already in the position of calling out [for] war crimes in Ukraine, for me is a step too far.”

The Biden administration has not made an official statement about the president’s plans for the Bali summit. In a press conference on April 7, press secretary Jen Psaki noted that the meeting was seven months away, “a lifetime.”

A history of expulsions

If Russia were excluded from the G-20 — a prospect that most experts view as unlikely — it would not be the first time the country had been ousted from a prestigious international organization.

Russia’s membership in the G-7 group of some of the world’s largest economies (at the time, the G-8) was suspended in 2014 after it invaded and took over Ukraine’s Crimean Peninsula.

Russia formally left that organization in 2017 and expressed no interest in rejoining it, even after then-U.S. President Donald Trump and then-Italian Prime Minister Giuseppe Conte called for its reinstatement in 2018. The G-7’s other members rejected the proposal unanimously.

Source: Voice of America