After years of talking, it seems that the proposal to establish a State Bank for South Africa is now moving forwards. It’s a big desire of Cyril Ramaphosa’s to build a monetary institution controlled by the government, and finance minister Tito Mboweni has also been told to make provisions for this new fiscal department.
One of the first things Mboweni and his team will need to do is decide if the new institution will be a consumer-focused bank or a developmental bank. The former provides services to individuals, while the latter will typically focus on medium – and long-term finance to the industrial and agricultural segment; possibly also the public sector.
In a statement shared by the Treasury on Tuesday, Director-General Dondo Mogajane outlined the basics of the progress made so far. G-tech, which is a subsidiary of the financial gatekeepers, has already submitted a preliminary report which aims to provide the government with their options going forward.
The next step will be a debate in Cabinet. Ministers and figures from the presidency will mull over the possible ways to implement a State Bank while discussing its feasibility. According to Dondo, work has already been done to ensure this policy becomes a key feature of the ANC’s sixth Parliamentary term.
“Work has been done. A preliminary report, done within Treasury, has been completed to inform us of the options available for us as we move towards finalisation of the establishment of the State Bank. So the next step is for it to go to Cabinet for preliminary thoughts on what we think we have or ideal what it will be like.”Treasury Director-General Dondo Mogajane
The National Treasury says plans are underway for the establishment of the State Bank.#sabcnews— SAfm news (@SAfmnews) July 7, 2020