General: Ramaphosa defending Reserve Bank independence?

In ‘managing’ the country’s monetary policy and the ‘protection, … efficacy and defence of … (its) currency’, the South African Reserve Bank (SARB) should remain ‘an independent entity’ – leaving government to ‘focus on the fiscal side’ of things. Pam Saxby, for Legalbrief Policy Watch, notes President Cyril Ramaphosa is reported to have made these remarks last week during his ‘first engagement’ with members of the South African National Editors’ Forum at Tuynhuys in Cape Town (Fin24).

Having participated in ‘crafting’ the clause in SA’s Constitution dealing with the SARB, the President apparently believes its provisions to be ‘unassailable’. As Legalbrief Today reported in December, among other things the ANC’s 54th national elective conference charged government with developing ‘a proposal to ensure (the SARB’s) full public ownership in a manner that does not benefit private shareholder speculators’. Under the heading ‘economic transformation’, a report on the conference describes private shareholdings in the bank as an ‘historical anomaly’. This may explain why, according to Fin24, Ramaphosa ‘initially tried to avoid the question of when the ANC resolution would be implemented’. Only when ‘pressed on the matter’ did he note the fundamental importance of an independent SARB to the success of efforts to ‘modernise’ the economy.

Meanwhile, EFF commander-in-chief Julius Malema has announced his intention to table an amendment Bill in Parliament with the aim of making the state ‘sole shareholder of … shares in the bank’. His move may have been prompted by frustration with an ANC parliamentary caucus decision in March to withdraw its motion for a debate in the National Assembly on ‘full public ownership’ of the SARB ‘in line with international practice’. At the time, more consultations were planned with ‘key stakeholders’ and within ANC structures. As Legalbrief Today reported on Monday, according to an explanatory summary of the EFF’s Bill it will seek to vest associated rights in the Minister of Finance and make the President (in consultation with the Minister and Parliament) responsible for appointing the SARB’s governor, deputy-governor and ‘all other directors’. While the proposed new statute has yet to be made available, a 30-day public commentary period began on Friday when the summary was gazetted. In February, it was on the EFF’s initiative that the House voted to ‘review section 25 of the Constitution and other clauses where necessary to make it possible for the state to expropriate land in the public interest without compensation’ – a process now well under way.