South Africa's central bank governor says will go to war to protect independence
* Ruling ANC has proposed nationalisation
* SARB governor says debate has become confused
* Kganyago on IMF support: we don't have to go there
(Adds comments on the IMF, further details)
By Alistair Smout
JOHANNESBURG, Aug 7 (Reuters) - South Africa Reserve Bank
Governor Lesetja Kganyago said on Wednesday he will fight to
protect the central bank's independence if it is jeopardised by
plans to bring it into public ownership.
He has been vocal in expressing concerns over plans by the
ruling African National Congress to nationalise the SARB, and
some party factions have also said that the SARB should have an
expanded mandate with a more specific focus on jobs.
The central bank governor said that he would not engage in
internal ANC party squabbles, but he would strongly defend the
central bank's independence if it was threatened by any
"This conversation ... confuses ownership with the mandate
of the institution and the independence of the instition,"
Kganyago said at a briefing.
"If it ends up happening and nationalisation takes place,
what would we go to war about? When our independence is
threatened, that's when you will see us taking the fight."
The primary focus of the bank's monetary policy is price
stability, but it also seeks to ensure sustainable growth.
Unlike most central banks in the world, the South African
Reserve Bank (SARB) is privately owned.
But ANC members have said the people should have sovereignty
over the bank, and at a party conference in 2017 the ANC
resolved to move it into full state ownership, saying that its
current status is an historical anomaly, though officials have
pledged it will be implemented responsibly.
Kganyago said that the agenda to nationalise the SARB was
being driven by foreign shareholders who could profit from it,
and that the debate had become muddled.
"Of all challenges that are confronting us at the moment, is
a conversation about the nationalisation of the Reserve Bank the
most important debate South Africans should be engaged in?," he
South Africa's economic growth outlook is uncertain, and
data last month showed unemployment had risen to an 11-year
high. Earlier data showed economic growth shrank in the first
Initial optimism around President Cyril Ramaphosa's ability
to revive the economy has faded, and credit ratings agencies
cite bailouts for big state-owned companies like Eskom as a
major risk to its outlook.
Its weak growth and high debt has prompted speculation that
it might look for support from the IMF.
"We don't have to get there," Kganyago said of an IMF
approach. "These problems are within our grasp. We know exactly
what must be done. We know the trade-offs that must be made. We
must make those trade-offs."
(Reporting by Alistair Smout;
Editing by Alison Williams)
First Published: 2019-08-07 15:49:30
Updated 2019-08-07 17:15:00
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