South Africa’s African National Congress (ANC) alluded to a greater focus on job creation by the country’s central bank in resolutions from its recent national conference, but stopped short of calling for its mandate to be changed.
ANC officials have for years toyed with the idea of broadening the central bank’s mandate as the governing party has struggled to lower the unemployment rate, which officially stands at 33% (ZAUNR=ECI) and is among the world’s highest.
The resolutions on economic transformation seen by Reuters on Friday said the South African Reserve Bank (SARB) should implement monetary policy “in a balanced manner, taking into account growth, employment and exchange rate factors”.
The central bank’s primary focus, as spelled out in the constitution, is currently “to protect the value of the currency in the interests of balanced and sustainable economic growth”.
The debate has unnerved investors as the bank has a strong reputation for acting independently, and the push to change the mandate has been used as a weapon in ANC factional battles.
In an apparent attempt to ease such fears, the resolutions from the ANC conference that ended last week said “the constitutional independence of the SARB must be reaffirmed”.
The ANC still wants to end the SARB’s private ownership, but said it will do so without overburdening public finances.
Finance Minister Enoch Godongwana told Reuters on Thursday that the party wanted the central bank’s role to “explicitly” include job creation, even though its current mandate implicitly implies that by mentioning sustainable growth.
Another key focus of the ANC’s conference resolutions was ending crippling power cuts, which are a major source of public frustration and a brake on growth.
“Immediate actions are required to bring power stations into efficient operation and improve the skills base, including sourcing external skills needed,” the party said.
President Cyril Ramaphosa, re-elected as party leader in December, has not meaningfully lifted the growth rate in the almost five years since he became head of state in 2018, hampered by power constraints, COVID-19 and ANC infighting.
The pandemic saw 10 million more South Africans needing social assistance as unemployment rose, and there have been growing calls from civil society to do more to help.
The resolutions suggested the ANC was considering increasing welfare payments, which was hotly discussed last year.
