South African politicians tussle over central bank mandate

Leaders of the ruling African National Congress and members of the South African government have clashed over the mandate of the South African Reserve Bank in the wake of the May general elections.

“The national executive committee agreed to expand the mandate of the South African Reserve Bank beyond price stability to include growth and employment,” said African National Congress (ANC) secretary-general, Ace Magashule, at a press conference on June 4.

Magashule claimed the party had also directed the government “to consider constituting a task team to explore quantitative easing measures to address intergovernmental debts to make funds available for developmental purposes”.

However, the ANC’s economic transformation head, Enoch Godongwana, issued a statement saying “there is no decision to expand its mandate”, according to the Sunday Times of South Africa.

Additionally, finance minister Tito Mboweni said it is not the party’s competence to change the central bank’s mandate. “Government sets the mandate for the Sarb,” said Mboweni on Twitter.

The former Sarb governor added: “There is no quantitative easing thing here. The primary mandate of the SA Reserve Bank is to ‘protect the value of the currency in the interest of balanced economic growth and development’.”

On May 8, the ANC won South Africa’s election with 57.5% of the votes, the lowest share since the end of the Apartheid regime in 1994.

President Cyril Ramaphosa says he has been attempting to reduce the imbalances in public finances and tackle corruption since coming to power in February 2018. Ramaphosa has reduced the number of supporters of former president Jacob Zuma in his government, but still does not enjoy the full support of his party.