Narrowing the gap between rich and poor is key to avoiding a destructive rise in populism, German Finance Minister Wolfgang Schaeuble said on Saturday as he laid out a plan to boost private investment in Africa.
“If we do nothing to change this, we can expect a rise in populist parties and demagogues, and a rise in instability around the world, with all its negative effects for sustainable growth”, he said in a speech in Washington.
“We are seeing it already in some parts of the world,” he said during the Global Infrastructure Forum at the Inter-American Development Bank. Schaeuble is among the officials attending the IMF and World Bank spring meetings this week.
He said Germany, which holds the presidency of the G20 group of nations, is pushing a plan to have African nations partner with certain G20 countries and international lenders, such as the World Bank, to attract outside investors to the continent.
The first stage of the proposal, dubbed “Compact with Africa,” would focus on Rwanda, Senegal, Tunisia, Morocco and Ivory Coast.
“If we want to ensure long-term stability and security, we have to continue to reduce the gap in wealth between the rich countries and the poor countries of this world, especially on the African continent”, Schaeuble said. Read full report here.