By Mxolisi KaNkomonde
The South African Reserve Bank (SARB) is not independent and its operations are privatised although it is a creature of statute. SARB is managed by a board of 15 directors where 7 are appointed by the President in consultation with the board and the finance minister, and the other 8 are elected by private shareholders. SARB is therefore controlled by private shareholders.
SARB prints bank notes and coins and then issues them for use in the Republic but 95% of the money in SA is created by private banks with only 5% created by SARB. In effect SARB doesn’t control money supply in the Republic outside setting the REPO rate.
The Finance Minister has an oversight role over the entire monetary system which benefits private banks and works against the government and the public.
During apartheid, SARB was the bank to which government looked for finance in cases where tax revenues couldn’t cover the national budget. This finance came at low interest rates. However this has since changed with the advent of democracy. Today, the private banks appoint their own finance minister in order to keep the parasitic relationship between SARB, government,Treasury and the South African public.
South Africa is currently sitting on a debt worth R2 Trillion after 22yrs of majority rule while the Apartheid regime had R68bn after 41yrs so SARB, private banks, treasury and finance ministers are raping this country though debt with their parasitic relationship.
With a budget of R150bn annually, SA currently spends over R500m a day on interest to private banks.
The Apartheid regime had massive industrial and government expenditures with huge projects such as SASOL, Council for Scientific and Industrial Research (CSIR), Bantu Universities, Koeberg, Phelindaba and a huge army yet national debt did not explode to the levels we have seen since 1994 as if the country was engaged in a war.
There has been a lot of talk about state capture and patronage but no focus has been brought to this massive corruption going on in South Africa where a country with high unemployment, inequality and poverty funds a patronage network led by different finance ministers in excess of R500m per day.
In December 2015 President Jacob Zuma reshuffled his cabinet by firing Finance Minister Nhlanhla Nene without consulting banking oligarchs in South Africa and within a few days banking shares tumbled. Banking CEOs quickly held an emergency meeting with ANC top leadership to plead for a reversal of the decision and the appointment of a finance minister who would retain the patronage network currently going on at Treasury which impoverishes every South African regardless of race.
The South African Reserve Bank, Treasury, the finance minister and private banks could be in serious violation of the constitution which stipulates that SARB should be independent but Parliament and the public at large have failed to arrest this problem.