Gordhan is Finance Minister of the Year

Pravin Gordhan (Image: GCIS)

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"The prudent fiscal policy led by Pravin Gordhan, who became finance minister in 2009 at the height of the global economic crisis, has been praised by analysts, especially since South Africa is more exposed than other emerging markets to dangers stemming from an eventual pullback of quantitative easing by the Federal Reserve," read the citation.

In his acceptance speech in Washington DC, where he has been attending the annual meetings of the World Bank and the International Monetary Fund (IMF), Gordhan thanked Emerging Markets for its recognition of South Africa and its economic team, which has kept the South African economy on track during a very difficult time.

"Together with our Nigerian and other colleagues, we hope to make Africa a much greater economy," said Gordhan.

Sudden change

Gordhan was critical of the sudden change in the narrative about emerging markets, which up until the second quarter of this year, were praised for managing their economies very well, contributing more than 50% to global economic growth and for lifting large numbers of people above the poverty line.

"Three months later, we are apparently fragile and we are terrible managers of our economies. We, the emerging markets, are here to stay. We live in an interconnected world, and more importantly, we live in an interdependent world. There is no decoupling from you, the advanced economies, and there is no decoupling from us, the emerging markets," Gordhan said.

In his address at the 28th International Monetary and Financial Committee meeting, Gordhan warned that while stronger economic activity in advanced economies will have a positive impact on global growth, it will also have negative spill over on emerging market and developing countries (EMDCs).

"In future, downside risks remain elevated. In the euro area, recent indicators point towards a re-emergence from the recession, but with its weak banks and high sovereign debt, the euro area remains fragile and vulnerable to sharp shifts in sentiment.

"The United States has seen several quarters of relatively strong economic activity and this had a positive impact on global growth. At the same time, however, uncertainty regarding the unwinding of unconventional monetary policies and the threat of potentially devastating budgetary challenges continue to pose serious risks to the global economy," he said.