Bundesbank places first representative in Africa

The Deutsche Bundesbank has placed its first representative in Africa as part of an initiative to improve its cooperation with the South African Reserve Bank (Sarb), both central banks revealed on August 29.

Jenny Kilp, a member of the Bundesbank's directorate in general financial stability, will be based at the German embassy in Pretoria for the next two to three years. Her role will be to take charge of collaborative research projects between the two central banks in monetary policy and financial stability.

"Our representatives' main tasks include observing and analysing the financial system, and not least detecting financial crises early on, should they arise," Andreas Dombret, member of the executive board of the Deutsche Bundesbank, said at a media briefing in Pretoria.

The appointment of a Bundesbank representative comes after the two central banks signed a cooperation agreement in February this year, aimed at enhancing collaboration between the two institutions.

The expansion of the Bundesbank's network of representatives, Dombret said, would enable the central bank to "track developments" in almost all of the G20 countries. Up until now, the African continent has been a "blank spot" on the map for the Bundesbank, he said.

Currently, the German central bank has two representative offices, in New York and Tokyo, as well as a number of representatives based at German embassies or consulates worldwide.

Two research projects will now start under the new cooperative agreement: the first will concern best practices in bank stress-testing; while the second will explore how to cooperate more closely on G20 issues. Germany will take over the 2017 presidency of the G20 on December 1 this year.

Appearing alongside Dombret at the briefing, Sarb deputy governor Daniel Mminele explained how Kilp would facilitate these projects.

The posting of a Bundesbank representative to South Africa would strengthen the central bank's capacity to individually and jointly participate in international organisations and forums, Mminele said.

South Africa is Germany's most important trading partner in Sub-Saharan Africa, while Germany is the second largest trading partner for South Africa. In 2015, bilateral trade volume grew to more than €15 billion ($16.7 billion).