ANC not ready to seize Sarb

A top ruling party official said plans to nationalise the central bank will be shelved as the government wrestles with getting the economy back on track.

The country doesn’t have the “massive resources” that may be needed to buy out the bank’s private shareholders and spending the money would be unjustified in the current economic climate, said ANC treasurer-general Paul Mashatile. “We would not want to rush to go in that direction because there are other implications,” he said.

“Our view is that we want these resources to be channelled rather to infrastructure projects.”

The ANC decided at a conference in 2017, that the state should take ownership of the SA Reserve Bank, one of a handful of central banks owned by private investors, because the prevailing ownership structure infringed on the nation’s sovereignty.

The shareholders have no say over monetary policy decisions and the bank’s mandate – to ensure price stability – is set out in the constitution.

The Economic Freedom Fighters has been pressuring the ANC to follow through on its resolution that the state assume sole ownership of the bank and has tabled a draft law that would trigger the process.

Parliament’s legal advisor has warned the Bill may be unconstitutional, because it would enable the shares to be expropriated without compensation, and ANC lawmakers have indicated they will reject it.

The central bank’s shareholders may seek a payout based on its total assets, including the $56 billion (about R911 billion) of gold and foreign reserves it holds on the country’s behalf, Mashatile said.

“That can be a problem, it will make the bank very expensive,” he said.

Mashatile also rebuffed suggestions that the government change rules for pension funds to force them to invest in state infrastructure projects.