South Africa’s antigraft watchdog defends comments on central bank

JOHANNESBURG: South Africa’s anti- graft watchdog ye s t erday defended her recommendation that the central bank’s mandate of maintaining currency and price stability be changed, saying the bank should act in the interests of empowering ordinary citizens.

In an interview with 702 Talk Radio Busisiwe Mkhwebane also said that the central bank’s mandate was focused on a “few commercial interests.”

“The Reserve Bank should be acting in the interests of empowering South Africans,” Mkhwebane said. “The way it is (now), it is only focusing on very few commercial interests.”

Mkhwebane made the proposal to change the bank’s mandate at a news conference on Monday where she delivered her findings on an apartheid- era bailout of a bank that was subsequently bought by Absa, now a unit of Barclays Africa Group.

In her statement on Monday Mkhwebane specifically said the phrase “to protect the value of the currency” should be removed from the constitution.

The rand weakened as much as 1.6 per cent on Monday after Mkhwebane recommendations, but on early Tuesday it had recovered some ground, trading 0.2 per cent firmer at 12.9500 per dollar, a touch off the three-week lows of the previous session.

“The proposals add more noise to the South African political saga, which is being offset to a large degree by a favourable top down emerging markets backdrop and improving domestic fundamentals,” Head of Emerging Markets Strategy at Societe Generale Jason Daw said in a note. — Reuters