The ANC is pushing ahead with efforts to nationalise the South African Reserve Bank (Sarb), despite concerns that it could strain the country's fiscus.
Reserve Bank Governor Lesetja Kganyago has told EWN that they will not participate in ANC's discussions and has warned that nationalising the reserve bank could be a costly fight.
Economist Sam Rolland says nationalisation could be an expensive exercise with no value.
He has questioned why the ANC would push for nationalising Sarb at a time when ratings agencies and other intentional investors are monitoring South Africa's stability.
Rolland says the mandate and independence of Sarb is enshrined in the Constitution.
At what cost will nationalisation come? It will be an expensive exercise.— Sam Rolland, economist at Econometrix
You have to really wonder what the ANC is thinking with its push to nationalise the bank.— Sam Rolland, economist at Econometrix
Yes, there are private shareholders, but the powers of private shareholders really are very limited.— Sam Rolland, economist at Econometrix
The outside world is really looking to see how much stability we can maintain.— Sam Rolland, economist at Econometrix
For the state to nationalise the Reserve Bank, it will have to buy out its shareholders.
Rolland explains that this will be a difficult and expensive task with shareholders who are either reluctant to sell ro selling at a hefty price.
Take a listen to his analysis: