This is the view of the South African Communist Party (SACP) secretary-general Solly Mapaila, who spoke to Sunday World on the sidelines of the ANC’s elective conference. The key alliance partner of the ruling party depicts a bleak picture, saying the banking and financial sector is holding the country to ransom.
The boldness of banks points to the indecisiveness and lack of political will from the ANC-led government, which has encouraged big capital’s bullying tactics. “We have development finance institutions such the PIC and IDC that have accounts with commercial banks, what nonsense is that. Development finance institutions should have their own banking licences to drive transformation,” said Mapaila.
He said at the heart of South Africa’s problems was the foreign and local private monopoly and oligopoly structure of the banking and financial sector, which were saying government should push, among other things, developmental state ownership, including co-operative banks and financial institutions.
The financial sector comprises banks, capital markets, savings and investment management, and non-bank financial firms mostly specialising in insurance. The sector contributes close to 22% of SA’s GDP.
Mapaila believes that tightly regulating capital and currency markets would ensure more investment in productive activity to reduce inequality and create jobs and decent work. He said the government had chosen to be a bystander, acceding to the dictates of big capital, which called the shots and determined the rules of engagement when it comes to transforming the financial sector.
“Why on earth developing nations do not have their own finance institutions boggles the mind. We must change the way we have been doing things if the country must improve. The lack of public banking institutions has been a huge setback.
