Experts slate EFF Reserve Bank move

Nationalisation will cost South Africa more money

ECONOMISTS have slammed the introduction of a bill before Parliament by the EFF which seeks to nationalise the SA Reserve Bank.

EFF leader Julius Malema introduced the South African Reserve Bank Amendment Bill on Thursday, which seeks to make the state the sole holder of shares and to provide for the appointment of board directors by the finance minister.

Economist Mike Schüssler said nationalising the country’s central bank would not benefit the country but instead increase state expenses.

“It is not a good idea. Government will have to spend more money to take out the private shareholders.

“The fact of the matter is that this is not going to change anything when it comes to policy because the government appoints all the people who do policy work, and appoints all the members of the monetary policy committee,” said Schüssler.

In its quest, the EFF is backed by the ANC which resolved at its 2017 December conference to nationalise the central bank.

In March, the ANC withdrew its initial motion to debate the nationalisation of the Reserve Bank, saying it needed MIKE SCHÜSSLER more time to consult on the matter within its structures and with key stakeholders.

The head of the presidency, Zizi Kodwa, said the resolution still stands.

Schüssler said the move was nothing but an election tactic by the EFF, which could be damaging to the country.

“It is not a worthwhile exercise at all. It will not benefit the people of South Africa in any way. It runs the risk of being harmful.

“There is no positive interest that can be derived from nationalising the Reserve Bank,” said Schüssler.

EFF chief whip Floyd Shivambu said the country would gain “economic sovereignty” by nationalising the Reserve Bank.

“This nationalisation will guarantee the economic sovereignty of South Africa. Currently, the Reserve Bank has got a lot of foreign shareholders.

“The nationalisation of the Reserve Bank doesn’t mean that we are going to interfere with its relative autonomy. We are not going to alter the autonomy of the bank but remove private shareholders,” said Shivambu.

He slammed critics who said the move could have a negative impact on investor confidence.

“Every time there has to be a change in the country, the so-called economists raise the issue of investor confidence. There is no investment in South Africa now.

“Investment must come from the state in terms of directing to important areas,” said Shivambu.

DA MP Gwen Ngwenya, its head of policy, said the party would not support the motion. She accused the EFF of crafting a route for “undue state influence and corruption”.

“Julius Malema and the EFF are playing Russian roulette with the economic prospects of the country.

“At the time when investors seek certainty, they introduce a giant question mark over South Africa’s monetary independence, and it is a dangerous game,” said Ngwenya.