South Africa’s biggest political party, the African National Congress (ANC), will revive a debate about expanding the central bank’s mandate at a key meeting later this year, Business Day reported, citing a party document.
While maintaining the independence of the South African Reserve Bank is important, the institution “must operate in a manner that supports transformation and development,” the discussion document said, according to the newspaper.
“Monetary policy should be balanced with developmental objectives: while containing inflation, it should also consider employment and growth.”
In the document, prepared ahead of a National General Council meeting in December, the ANC said a focus on fiscal consolidation and inflation targeting resulted in austerity, budget cuts and underinvestment, Business Day reported. A separate discussion document said the pace of interest-rate cuts has been too slow.
Previous debates within the ANC about the role of the central bank have raised investor concerns about the institution’s independence and South Africa’s commitment to prudent economic policy.
BLOOMBERG