President Cyril Ramaphosa confirmed in his State of the Nation speech on Thursday that the government is set to establish a sovereign wealth fund together with a new state bank.
Both proposals have been punted by the ANC over several years and have support from opposition parties such as the EFF, which saw its own proposal to nationalise commercial banks being shot down in Parliament in 2017.
The sovereign wealth fund and state bank plans have however, also had their detractors, including the DA.
“We have decided to establish a sovereign wealth fund as a means to preserve and grow the national endowment of our nation, giving practical meaning to the injunction that the people shall share in the country’s wealth,” Ramaphosa said.
“We are also proceeding with the establishment of a state bank as part of our effort to extend access to financial services to all South Africans,” he added.
The president did not give timelines for the establishment of the sovereign wealth fund or state bank. However he said that Finance Minister Tito Mboweni will provide details on the plans in his budget speech on February 26.
Mboweni himself has in the past also expressed support for a state bank. During a treasury budget vote debate in July last year, he mentioned that his deputy, David Masondo, had been tasked with leading the process for the establishment of a state-owned bank. Both Mboweni and Masondo have bemoaned the discriminatory nature of South Africa’s established banks.