SA determined to nationalise central bank, Ramaphosa says

Ramaphosa says nationalising the central bank will affirm the nation’s sovereignty.
South Africa is one of a handful of countries whose central bank is owned by private investors. Picture: Waldo Swiegers, Bloomberg

South Africa’s ruling party has taken a decision to nationalise the central bank and it will be implemented, President Cyril Ramaphosa said.

“We have got to go through processes,” Ramaphosa told parliament in Cape Town on Thursday. “There is no hidden agenda.”

Ramaphosa’s comments come a day after he was scheduled to meet with Reserve Bank Governor Lesetja Kganyago in Cape Town. Kganyago on Wednesday emphasised the importance of central bank independence in a speech on a university campus.|

South Africa is one of a handful of countries whose central bank is owned by private investors and the move to bring it under the control of its citizens will affirm the nation’s sovereignty, Ramaphosa said.

The rand extended declines after Ramaphosa spoke, declining as much as 0.7% against the dollar. It was 0.5% lower at 14. 3408 per dollar at 2:44 pm in Johannesburg.

What to know about the Reserve Bank’s owners

The Reserve Bank has about 770 shareholders and two million shares outstanding. Investors are allowed a maximum of 10 000 securities each, which gives them a prescribed maximum dividend of R1 000 rand. The last traded price for the shares, which are available over the counter, was R9 in January.

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If you cannot run the SOE’s and PIC, how the heck are you going to run the Central bank????????

You know they run the SARB already.

Govenor – Appointed by President
3 x Deputy Govenors – Appointed by President
4 x Directors – Appointed by President
= 8 Directors

7 x Directors appointed by Sharehodlers

Mandate of Reserve Bank determined by Constitution (can by changed by Legislator not Shareholders)
Other Regulatory Matters governed by Reserve Bank Act (can be changed by Legislator not Shareholders)

So exactly what are the private shareholders controlling?

Oh and by the way, no shareholder can own more than 10,000 shares and can only get R1,000 dividends per year, so you are not even holding a valuable commercial asset.

Politically controlled Reserve Banks mean that governments spending goes out of control. This is why the US is having issues with Trump’s indirect attempts to manipulate their decisions via media.

I reckon Moodys will have little choice now..
1. Debt is huge and no real austerity measures brought in.
2. Restructure but no retrenchment in Eskom albeit overstaffed.
3. EWC vs landrights

and now in a populist move they want to tackle the independence of the reserve bank? Get ready for Junk come March 29

@ Kashif
The Reserve Bank does not control government spending – Treasury does, and it has always been politically controlled.

Look, I am totally against nationalisation of banks and industry (EFF talk) and all for privatisation of SOEs, but this Reserve Bank thing is a whoaaa over nothing.

Again from my post – the private shareholders have no say currently. “Nationalisation” will change nothing in itself.

Its when the Mandate get changed that we should be worried. And that is a constitutional matter, in the hands of the legislator. It not influenced/controlled/protected AT ALL by the private ownership of the bank.

The ownership thing is really a red herring. Lots of more important things like the SARB mandate for us to get worried about. If the SARB mandate is changed from inflation targeting to something like job creation – as suggested by our retarted public protector – that will be something to get worried about

@daniemare the answer lays in your very 1st comment.. essentially by taking ownership of the Reserve Bank they have greater control of the voting Directors. Yes the president elects the governor and some directors but they don’t have voting control and the mandate guideline voted on is set in the constitution.controlling votes is what’s being attempted to skirt the fact that they do not have 2/3rds majority needed to change mandate.

The implication is that government can directly manipulate monetary policy or quite simply put vote along the ANC policy directives. Ie inflation Targetting will be a thing of the past to achieve “Radical Economic Transformation” as defined by whom ever leads the governing party.

If the past decade has not taught you much, the ANC itself is subject to populism from within and they have been unable to self regulate and keep their fingers out of the purse. Do you trust the ANC when they have a near 2.5 decade history of failure with state organizations in their control?

The ANC has in the past openly said their mandate would be cheap cash and not inflation targeting.

they might not control – but they sure as hell provide oversight. And we would have to change the consitution to change the structure anyways – so how hard would it be to increase the directors’ mandates, or discretion?

Oversight and insight….without the 7 shareholder directors we are in a boat where no one recalls or remembers how anything or everything went wrong.

Trillions will go missing and the response in Parliament will be “we” have no recollection of that.

Only 3 reasons why ANC wants the SARB…

Because they’re low on cash and

1. SARB has a printing press.
2. SARB has a printing press.
3. SARB has a printing press.

You’re not a complete banana republic until you have keys to the printing press.

Don’t take this too seriously. Mere electioneering.

Why, the anc cannot even run a bath?

Superb chirp. ANC must privatize as much as possible not control anything as all what t hey can do is steal, steal and more stealing. No benefit other than voter rhetoric. CR the biggest ANC failure ever. No delivery, rubbish in the cabinet, failed SOEs, crime, corruption,SARS mess, …all talk …self enriched man who never built a corner cafe but abused BEE to enrich himself.

He didn’t abuse BEE, he created it… He was there drafting the rules and then becoming a billionaire… Ref and player of the game of legalised theft… and now he president, he is a clearly a master of manipulation and deceit, or he wouldn’t be a good politician…

Sheesh, just leaving my comment here to get a thumbs up. Seems like this is about to kick off.

Another VBS in the making?

Who controls SA’s foreign reserves? Will the Cadres be able to plunder the loot?

All Reserve Banks pretend to be independent. Every informed person wants an impenetrable barrier between politicians who want to steal the purchasing power of the currency to buy votes, and the Governor of the Reserve Bank, who is the custodian of the buying power of the currency.

The reality is that in effect, no Reserve Bank is ever completely protected against the ruling politicians. The ultimate purpose of the Reserve Bank is to stabilize the banking system. The mandate and the constitution force the Bank to act in a certain manner when ignorant politicians become a threat to the banking system.

When racist and plundering BEE policies cause the demise of SOE’s, when cadre deployment drives municipalities into bankruptcy, when the public wage bill and social grants become unsustainable, when the results of socialist policies destroy the economy and jobs, when assets held as collateral by the banks start to decline in value and when municipalities and SOE’s begin to default on their debt, then the Reserve Bank is forced to print money like there is no tomorrow.

Our Reserve Bank is totally exposed to the actions of this ANC government and that is a matter of great concern. The Reserve Bank has to pay for the mistakes of ignorant politicians.

David Mabuza, Deputy President to Rama do-nothing

Recently he said Eskom load shedding was the result of excessive demand and that the power stations could not keep up

The horror of how he must perceive the RB

The central bank controls $50 Billion in reserves or somewhere around that amount. This will be used to “save” the economy, but who are we saving it from? Our own elected socialist communists?

Pure election talk, to pre-empt the EFF. I predict nothing will happen to the Reserve Bank after the election.

I believe the Reserve Bank is actually well run.

The anc moronocracy want to finish plundering the last institutions left standing. Cry the beloved country

CR shows who he is! ANC not interested in good business practices or ethical governance but to get their hands on the money – investors need to be awake! The first step to rob the people in the SA who made contributions to the wealth of the country

Geez, first EWC and now this! CR is really pulling all Julius’s teeth. Wonder what he will find to ramble on about next??

Pack your bags and GTFO!

Legalising racism by our negroid fellow citizens against any minority they see fit to abuse?

Cheap electioneering? I say this to the ANC, please go ahead and nationalise the Reserve Bank. All you will end up doing, like just about everything else you do, is harm the very people you ridiculously claim to support. This plus EWC will make this country a far less desirable investment destination but you cannot tell this outrageously arrogant and naïve organisation, with a litany of failures to its name, anything.

As Dawie Roodt said get your money out of the country. First get it out of the reserve bank. Consider crypto, not to get your money out of the country but to get the country out of your money. 12 months from now your rand will be R25/$1 and bitcoin will be $80 000 each.

I have got one word for you: Quadriga.

True! Out of the frying pan, into the fire….buying Cryptocurrencies is like bungee-jumping, you get quite a rush, but there is no return of- or on capital.

Although the SARB is basically run by the governing party Cyril Ramaphosa has shown by his actions or non actions, his true worth. Just another talker and SA still being run down into the ground. For those staying buy gold. Or another miracle vote the ANC out. Could happen.

Setting the interest rate. This have a effect on all. Controlling tool bank for the currency. In the U.S and Europe they print and distribute their currency again zero interest. Zero again the local 6 percent makes competitive producing only attractive with a yearly local 6 percent devaluation of the currency. Leveling of playing field. Check the last 5 years of currency exchange value. I want to be rich, it shows ways.

We should not be downplaying the significance here – this is not a small deal. To change hte board structure will require amending the same act that determines the bank’s mandate. Those 7 independent directors are there for oversight purposes. Once we change the act, how hard will it be to redefine clauses giving the directors increased discrection, without oversight, into its mandate?

so… Ramaphoria didn’t last long. Now it’s Ramageddon as Cyril and the arrogANCe have decided to adopt a ‘win at all costs’ approach to the May elections – they are SO desperate to keep their snouts in the trough after proving that they have absolutely NO ability to stop stealing, sorry, I meant to say GOVERN. their solution to everything is – increased or new taxes. When I read this article I had a zuma cabinet reshuffle flashback and realised that no matter who is in charge of the ANC the agenda will ALWAYS be the same – me first, what’s in it for ME, screw those people foolish enough to vote for the ANC. SA could’ve been THE economic powerhouse on the African continent, but courtesy of the ANC, we are fast become that place that Donald referred too.

ANC election promise: Free and decolonised monetary policy for the masses!

Soon we will all be living in huts again and there won’t be any roads anymore…

You can’t create wealth printing more pieces of paper with the words written IOWEYOU on it, because that is all paper money is: I OWE YOUs.

It doesn’t represent anything. It is just traded for more international I OWE YOUs. Do you understand? Real wealth is real products, real human labour, real innovation, real cost savings, real speed, real services.

Government lowering interest rates and printing more I OWE YOUs won’t change the wealth the country generates. Zimbabwe and Venzuela has discovered it for themselves. In fact the more I OWE YOUs in circulation, the less of those I OWE YOUs are successfully delivered as promised.

Le souffle des mots.

Dans la pureté
d’un rêve
magique le
son de la neige
décrit l’atmosphère
d’un paysage

Francesco Sinibaldi

End of comments.





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