Nationalisation of Reserve Bank should not be put on pause, it should be permanently abandoned

16 September 2020

The concession by the ANC’s Paul Mashatile that the ANC’s plan to nationalise the South Africa Reserve Bank (SARB) will not proceed for the time being, while welcome, does not go far enough. The plan should be abandoned altogether and buried for good. Mashatile pointedly did not rule it out for good, but blamed the decision to shelve it for now on the state’s lack of money to pay for the nationalization. This still leaves room for the issue to be used as a political football between the ANC’s warring factions, and does not draw a firm, clear line through it.

Having consistently repudiated it as a ‘mad idea’, the Democratic Alliance (DA) calls on the ANC and President Ramaphosa to make an unambiguous public announcement dismissing outright the nationalisation of the SARB.

This was never a rational policy stance by the ANC. It was an irresponsible stance that only succeeded in alienating investors and worsening perceptions of South Africa’s policy environment.

Any prospect of economic recovery depends on a policy environment that is focused on growth. This requires the ANC abandoning anti-growth, confidence-sapping policies like expropriation without compensation and nationalization of the SARB. It is not good enough simply to say that nationalization is on pause. It must be permanently abandoned.

If President Cyril Ramaphosa’s recent commitment to pursue a programme of economic structural reform is to succeed, he needs to ensure that he dismiss outright ridiculous policy proposals. It serves no purpose and is against the national interest.

Issued by Geordin Hill-Lewis, DA Shadow Minister of Finance, 16 September 2020