By Siviwe Feketha for IOL
Former president Thabo Mbeki has warned about the ANC’s call for the nationalisation of the SA Reserve Bank, saying it would not result in any material achievement. Picture: Dimpho Maja/African News Agency (ANA)
Johannesburg – Former president Thabo Mbeki has warned about the ANC’s call for the nationalisation of the SA Reserve Bank, saying it would not result in any material achievement.
Mbeki was speaking at the Gauteng ANC pavilion at the Rand Easter Show in Nasrec, south of Johannesburg, where he declared his intention to vote and campaign for the ANC in the upcoming election.
Since his defeat by his successor, Jacob Zuma, at the 2007 national conference in Polokwane and his recall by the party in 2008, Mbeki has not been active in ANC politics.
He said while he found it impossible to campaign for the party under Zuma due to wrongdoings, President Cyril Ramaphosa and his government demonstrated a commitment of addressing the party’s challenges.
“It is in that context that it becomes possible to come back and to be active publicly like this,” he said.
However, he criticised the party’s 2017 national conference resolution which called for the nationalisation of the Reserve Bank.
“I don’t know what anybody would gain by that nationalisation of the Reserve bank, except to say we have nationalised. Nothing would change in terms of the behaviour of the Reserve Bank, nothing,” Mbeki said.
He said while many in support of the move said they wanted the central bank to move away from inflation targeting, nationalising it would not result in policy change.
“Inflation targeting is not the decision of the Reserve Bank. It is a decision of the South African government. It is the government which said there must be inflation targeting and these are the targets between three and six percent. That is government and the Reserve bank implements,” he said.
If Economic Freedom Fighters (EFF) leader Julius Malema has his way, a “Banks Ownership Act” would be passed by Parliament, ensuring the State nationalise commercial banks in South Africa without compensation.
Introducing a debate on the issue in the National Assembly on Tuesday, Malema said: “There are no banks in South Africa that have meaningful ownership by black people”.
Malema said his party’s manifesto appreciates other forms of ownership are not excluded — including ownership by private individuals, the State and pension funds.
No single investor will own more than ten percent, he said.
“Our view is that the State ownership should be prioritised but should not completely close out other forms of ownership,” the fiery EFF leader said.
“This model of combined ownership, anchored by the State, makes sure banks are democratised…”
The ruling African National Congress (ANC) rejected Malema’s proposal.
ANC Member of Parliament (MP) Adrian Williams said banks would not just surrender their money.
“They are going to force this government to pay back the money,” Williams said.
“South Africa does not exist in a vacuum. When it comes to international finance we are just a cog in the capitalist wheel.”
He cited various examples where the State took over the ownership of banks and failed.
Williams said government would also assume the liabilities and debt, which would have an impact on the fiscus, and would result in poor South Africans and not the rich suffering.
The Banking Association of South Africa (BASA) also responded, saying the National Assembly entertaining the debate was “alarming”.
“Any nationalisation of banks will have a direct impact on stability, and will seriously undermine what fragile levels of confidence remain in our economy and society,” BASA said in a statement.
“We cannot allow ourselves to be in a position where we are further undermining the competitive positions that remain because of political expedience.”
BASA called on Treasury to provide certainty about its policy position regarding banks.
By Chantall Presence for IOL