From 26 to 28 February 2025, the first key events of the South African G20 presidency took place as Finance Ministers and Central Bank Governors held their inaugural meeting in Cape Town, the country’s coastal metropolis. The fifth edition of the Finance in Common Summit, the world’s major gathering of public development banks, took place at the same time, attracting around 2,000 delegates. South Africa is trying to pursue several important streams of financial architecture reforms during their Presidency, but the Finance Minister meeting failed to reach consensus on an outcome document. 

This year is the first time that an African country has held the G20 Presidency, as South Africa is the only African nation state among the G20 members (the African Union was admitted only two years ago, during the Indian Presidency). South Africa has chosen the motto “Solidarity, Equality and Sustainability” for their G20 term. Expectations are high that topics of specific relevance for Africa in particular and the Global South in general will be high on the agenda, potentially promising concrete outcomes in terms of institutional innovations and reforms. 

The South African Presidency raised high expectations early on, for instance by announcing a new “G20 Cost of Capital Commission” tasked with finding solutions for the sky-high interest rates. These are proving to be a burden to developing countries and are much higher than those of their peers in the Global North, due to the high risk premiums that they have to pay to private investors.

The Presidency has to navigate an extremely challenging environment for multilateral decision-making. The meeting in Cape Town failed to convene all G20 countries at a ministerial level. The Finance Ministers from the US, China, Japan, India and Canada were notably absent from the meeting. The US Minister’s absence was remarkable also because G20 presidencies usually work as a Troika where the acting presidency coordinates closely with the past and the following presidency. The US assumes the G20 presidency in 2026.

Debt issues and governance reforms high on the agenda 

The Chair’s Summary, issued after the Finance Minister meetings, addresses many relevant topics. It created political impetus for governance reform at the World Bank (through the Shareholder Review) and the International Monetary Fund (IMF) – through quota alignment – called for a successful replenishment of the African Development Fund and pushed for further reforms of the debt architecture (building on the G20 Common Framework).

The urgency to take action on debt was underlined by the new “African Leaders Debt Relief Initiative” (ALDRI), promoted in Cape Town by eight former African Heads of State. The Finance Minister meeting also created awareness of deliverables due under the South African Presidency, which include an updated “Operational Playbook for pandemic response with a focus on day zero and surge financing” and the Financial Stability Board’s final recommendations for addressing risks from non-bank financial institutions. 

Tax was certainly one of the controversial items. The Chair’s Summary calls on the Organisation for Economic Co-operation and Development (OECD)/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) to report on progress on BEPS, and to start its work on understanding how tax policies may exacerbate or mitigate inequality. The latter is a follow-up to agreements related to the taxation of high net-worth individuals at the G20 Summit in Brazil last year.

The Summary also “encouraged continued and constructive engagement with parties in the ongoing discussion on the development of a UN Framework Convention on International Taxation Cooperation” (FCITC). The US has recently walked out of the FCITC negotiations and declared it would not introduce the global minimum tax for corporations, which was an outcome of the BEPS process. According to the South African Finance Minister, climate finance has been another controversial issue.

Finance in Common Summit returns to Africa

The presence of G20 Finance Ministers attracted several back-to-back events to Cape Town. The largest and perhaps most relevant was certainly the 5th edition of the Finance in Common Summit (FiCS). Originally a French initiative to improve the coordination of public development banks (PDBs), the 2025 Summit took place in Africa for the second time. While FiCS seemed to have been an ad hoc initiative in the beginning, it is becoming increasingly formalized, with an expanding Secretariat in Paris, and a growing number of working groups that operate throughout the year. As well as attracting 2,000 attendees, the Summit in Cape Town adopted a Communiqué. 

The Summit also saw the launch of the Finance in Common contribution to the Fourth International Conference on Financing for Development, where the PDBs, among others, pledged alignment with the Sustainable Development Goals (SDGs). They want to work better as a system, and are calling for more injections of public funds into PDBs through capital increases. 

Another output was the PDB Reference Book. Using information from the PDB database, it is supposed to guide policy-makers with best practice and benchmarks on public development banks worldwide. As PDBs and PDB-funded activities can have severe impact on people’s livelihoods, positive as well as negative, civil society organizations (CSOs) presented a joint declaration in Cape Town, which included a call for better CSO participation. 

Alongside the PDBs, the Global Solidarity Levies Task Force convened in Cape Town. Another French initiative, the Task Force aims to raise additional finance for climate and development through global taxes. It got a mention in the Finance in Common Communiqué. 

Africa moves to the centre of multilateral policy-making 

The attraction of several informal coalitions proves that the South African G20 Presidency has helped to push Africa further into the centre of multilateral policy-making. This is a trend that was already visible when African countries took the lead on initiating the process towards a UN Tax Convention a couple of years ago. While the first Finance Minister meeting under the South African G20 Presidency got off to a rocky start, no one expected this meeting to result in substantial agreements. These are usually left to the Heads of State Summit, the climax of each G20 round. The actual G20 Summit is due to take place in Johannesburg on 22-23 November 2025. It is an opportunity that only arises every two decades in Africa. The expectation that it will lead to substantial decisions to reform the international financial architecture remains high.