Parliament has called on stakeholders and interested parties to submit written submissions on the South African Reserve Bank Amendment Bill.
Introduced by the EFF as a private member’s bill, the draft legislation proposes that all of the bank’s stakeholders are appointed by the government and are not private.
In an explanation of the bill in August, the EFF’s deputy president Floyd Shivambu said that the current South African Reserve Bank Act allows private individuals, including foreigners, to own shares of the South African shareholders based on the share capital of the bank.
“The private shareholders through acquired shares, in terms of the South African Reserve Bank Act, have some role to play in the governance of the South African Reserve Bank, including the election of the directors, and receive dividends from the bank’s profits.”
Shivambu said that the draft bill will:
- Make the state the sole shareholder of the South African Reserve Bank;
- Provide for the appointment of the board of directors, the tenure of the office of the appointed directors, and give the minister the power to make regulations related to the appointment of appointed directors;
- Give the minister of finance the power to appoint auditors of the bank.
The ANC has also indicated that it wants to nationalise the central bank, but the plan has been but on the back burner as government grapples to get the coronavirus-stricken economy back on track.
The ruling decided at a conference in 2017 that the state should take ownership of the South African Reserve Bank, one of a handful of central banks owned by private investors, because the prevailing ownership structure infringed on the nation’s sovereignty.
The country doesn’t have the “massive resources” that may be needed to buy out the bank’s private shareholders and spending the money would be unjustified in the current economic climate, said Paul Mashatile, the treasurer-general of the African National Congress.
“We would not want to rush to go in that direction because there are other implications,” he said in an interview with Bloomberg. “Our view is that we want these resources to be channelled rather to infrastructure projects.”