Share this
Mister Wong
Digg
Del.icio.us
Slashdot
Furl
Yahoo
Technorati
Newsvine
Googlize this
Blinklist
Facebook
Wikio
Hear this text
Print
E-mail
Tags
Banks are also now in their sights The nationalisation debate within the ruling ANC Alliance is gaining more momentum rapidly once more. Not only does the ANC Youth League (ANCYL) want South Africa’s mines to be nationalised, but ANC Secretary-General Gwede Mantashe now has placed the potential nationalisation of the country’s central and commercial banks on the agenda.
In recent months, ANCYL President Julius Malema has been calling repeatedly for the nationalisation of the mines. His calls have stirred much controversy and led to a serious clash between him and the South African Communist Party (SACP).
Now Mantashe has added a new dimension to the debate. In a report to the ANC’s national executive committee last weekend, Mantashe urged party leaders to broaden the debate to other sectors such as the banking industry. He called on the ANC to explain the role of the state in the economy and the redistribution of wealth.
Mantashe reminded his colleagues that the ANC’s historic basic policy-guiding document, the Freedom Charter, demanded that the mineral wealth, the banks and monopoly industry be “transferred to the people”, and said the ANC must answer whether it has made progress in this regard.
At first glance, this may appear as if Mantashe has moved closer to the controversial position of the ANCYL on nationalisation. However, though it stokes and broadens the nationalisation debate, Mantashe may also partly be playing for the gallery. For he is also the national chairperson of the SACP and has been central to the recent clashes between communists and the Youth League, with their aim of removing him as secretary-general at the next national conference.
Nonetheless, Mantashe pointed out that the South African Reserve Bank (SARB) is one of only a handful of central banks in the world that is owned by private shareholders and hinted that it should be nationalised. The ANC government of President Jacob Zuma already has agreed to demands from the ANC’s left-wing alliance partners, the SACP and the Congress of South African Trade Unions (Cosatu), to review and broaden the bank’s mandate.
Mantashe’s report, however, is the first pertinent move in ANC circles to suggest the Bank should be nationalised, and that the country’s private, commercial banks should also be put on the agenda in this respect. Private shareholders, whose identities are kept secret in terms of the law governing the SARB, own the bank, but its governor and other top executives are appointed by the government.
The Bank is accountable to Parliament (which is controlled by an ANC majority) and its autonomy is entrenched in the Constitution. At present, the SARB’s functioning is a hybrid of independent and politically guided actions and policies. It is particularly the Bank’s policy in favour of inflation targeting that has come under fire from the ANC’s left-wing allies, while the ANC government has accused it of not playing a developmental role in line with the ANC’s developmental policies.
Mantashe’s remarks, however, while placing these issues in the domain of ANC policy discussion with a view to formal inclusion on its policy-making agenda, at this stage still merely constitute his own opinion. The issue has not been discussed formally by the ANC. The ANC’s economic transformation committee may, however, consider the issue further with a view to preparing a policy paper for the party’s 2012 national conference.
Undoubtedly, the ANCYL, as well as the ANC’s left-wing allies, will seize the opportunity to bring South Africa’s banking sector into the nationalisation debate. The SACP, which clashed with Malema and the ANCYL over the modalities of the nationalisation of the mining industry, has long advocated far greater state intervention in the banking sector, while Cosatu has been leading attacks on the Reserve Bank.
The SACP just released a draft report of its Commission dealing with economic transformation and rural development as discussed at its second special national congress held in December. The commission reiterated that the SACP‘s fundamental objective is "socialisation" (the new buzzword it uses for nationalisation), which it “understands as establishing control by direct producers over the means of production”.
The party says it supports “the 52nd ANC Conference Resolution to establish a state-owned mining company and we will engage in the debate on nationalisation of the mining industry”, subject to its insistence that “any such moves must serve the transformation of the mining sector, key elements of which must include the beneficiation of mineral products and the transformation to promote increased decent work opportunities in the sector”.
The commission also reiterated the call for nationalisation of specific sectors made in the SACP’s 12th National Congress, which includes the banks.
The report added that “even short of nationalisation, we can begin to take steps towards transformation along the road to socialisation” and suggests opportunities arising from “capital’s increased dependence on the state” due to the global economic crisis and recession, should be exploited.
Should South Africa’s central and private banks be nationalised by the ANC government, the question arises: What will happen to this country’s widely respected, world-class banking system given the pathetic track record of the ANC in managing the country’s parastatals such as Eskom and the Land Bank? The sophistication of this banking system, which has been a major deciding factor in drawing much-needed investors to South Africa, will most likely be fatally compromised by any such move.
