Central banks and the challenge of development

For the first time in more than 30 years, there has been a marked revival of growth in much of Africa, and inflation has been brought under control in a large number of African countries. Central bankers from the region, meeting recently at the Bank for International Settlements (BIS) in Basel, held informal discussions on the policy issues they face, both individually and as a group, to build on these developments.

Opening the meeting, which was attended by participants from both industrialised and developing nations, Malcolm Knight, BIS General Manager, noted that "the steady decline in inflation across the whole continent – there are, sadly, one or two dramatic exceptions – is a justifiable source of pride for many African central banks, and this in itself creates an environment that favours development."

Papers delivered at the meeting have been published in a special conference volume, Central banks and the challenge of development.

Amartya Sen, Professor of Economics and Philosophy at Harvard University and a winner of the Nobel Memorial Prize in Economics, spoke about how "… the world now pays more attention to much broader indicators of economic success than GDP … moving away from the view that development is a very severe, austere and largely painful process, which so dominated the thinking of the development elite and international policymakers earlier on". He also underlined the key role played by central banks.

In his paper, Professor Sen points out that "central banks are not only public agencies with special roles in financial leadership and monetary policies, they are also important parts of the general political landscape of a country". He continues, "I am not, of course, arguing for central bankers to become obsessively "central talkers". But I would submit that they do have an important role in democratic public reasoning, in addition to their specialised tasks in monetary and financial affairs".

Available in English and French, Central banks and the challenge of development is now on the BIS website.