Ralph Mathekga

Ramaphosa may find himself isolated in Cabinet on the SARB. Here's why

2019-06-11 08:45
ANC Secretary-General Ace Magashule addresing journalists.  Photo by: Jabu Kumalo

ANC Secretary-General Ace Magashule addresing journalists. Photo by: Jabu Kumalo

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There are too few people in Cabinet willing to openly side with Ramaphosa on the SARB matter, whilst too many people are quiet and seem to be non-committal in the debate, writes Ralph Mathekga.

The ANC is failing to build a consensus on major policy decisions that need to be taken to save South Africa from a downward economic spiral. Listening to public remarks by senior leaders, the party seems divided as to what needs to be undertaken as a matter of urgency to fix the economy. 

For secretary general Ace Magashule, the most urgent matter for government ought to be expanding the mandate of the South African Reserve Bank (SARB) to include active measures aimed at creating jobs and ensuring the transformation of the economy. This is clearly a shift from the traditional role of the bank; understood to be the protection of the value of the currency and ensuring stability in terms of the flow of money in the economy.

Magashule's recent pronouncement that the ANC should look into the SARB matter can be justified as staying true to the party's Nasrec resolution and election manifesto in which it took a decision to go this route. But President Cyril Ramaphosa has made a commitment to restrain the likes of Magashule from implementing ideas like this, because it will have negative effects on his drive to resuscitate the economy by attracting foreign investors. 

Ramaphosa's assurance to the markets is that he will restrain the ANC from pursuing contentious decisions including the review of the mandate of the reserve bank.

In this scenario, one must ask firstly whether Ramaphosa will be able to restrain the ANC from implementing some of the priorities that the party committed to in the election manifesto and at Nasrec. Secondly, whether Ramaphosa will succeed in his agenda to lead South Africa through reforms that would see the economy recovering and unemployment declining. This is proving to be a challenge for the president. As far as this matter is concerned, Ramaphosa has more people to worry about besides the seemingly compromised Magashule.

If you take a closer look at Ramaphosa's Cabinet, you do not see too many keen defenders of his position to leave the reserve bank as it is. Among some elements who crawled their way back to Cabinet are powerful individuals from the leftist formation of the tripartite alliance. Cosatu and the South African Communist Party (SACP) remain visibly present in Ramaphosa's Cabinet.

Cabinet was decided upon as a matter of compromise among alliance partners as well, and the leftist elements are all over the executive. I cannot imagine the left leaning members of Cabinet joining the president in his defence of the SARB against an onslaught by Magashule and his allies in the ANC.

The idea that the SARB's mandate should be revisited is a brainchild of Cosatu and the SACP that goes back to when Tito Mboweni was still governor of the bank. Therefore, even if SACP and Cosatu members serving in Cabinet were to have problems with Magashule's politics, they will most likely be happy with him raising the reserve bank matter. With Ramaphosa struggling with a divided ANC, the alliance partners will most likely use this to push some of the issues that they would otherwise struggle to pass through a united and coherent ANC.

If one looks at the entirety of Cabinet, there are too few people willing to openly side with Ramaphosa on the SARB matter, whilst too many people are quiet and seem to be non-committal in the debate.

The difficulty that Ramaphosa is confronted with in this situation is that, much of his time might be spent on restraining people rather than advancing a clear project that would result in tangible results involving socio economic progress. The president has too many stakeholders around him to manage; to a point whereby little time will be left to advance a proactive plan.

The reality is for Ramaphosa is that he cannot put the matter to rest once and for all; he can only manage it on an ongoing basis to mitigate adverse impacts of the debate on the economy. Even if he succeeds in restraining the ANC, this might not be sufficient to revitalise an ailing economy.

The big task for Ramaphosa remains how to recharge a depressed economy. By the look of things, the president may only be able to pursue this in his second term since his first term will most likely be reduced to crisis management within the ANC and among alliance partners, instead of pursuing innovative projects that would turn things around. 

- Ralph Mathekga is a political analyst and author of When Zuma Goes and Ramaphosa's Turn.

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Read more on:    sarb  |  anc  |  cyril rama­phosa  |  ace maga­shule
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