Johannesburg - An adviser to new Finance Minister Malusi Gigaba advocated the state takeover of banks, mines and insurance companies in a newspaper editorial, two weeks after President Jacob Zuma’s ouster of Pravin Gordhan shocked investors and led to a debt downgrade.
In an opinion piece titled “Our chance to complete the revolution,” published in the Sunday Times, Christopher Malikane, an economics professor at the University of the Witswatersrand, also proposed the establishment of a state bank that would combine all government-owned financial institutions, the nationalisation of the SA Reserve Bank (SARB) and the expropriation of land without compensation to the owners.
READ: Why the SARB should be nationalised - analyst
The Sunday Times said Malikane, who has advised the Congress of South African Trade Unions (Cosatu), is an adviser to Gigaba, citing spokesperson Mayihlome Tshwete. Gigaba, who was appointed March 31, has pledged to avoid further debt downgrades and said on April 13 that he urged Zuma to stick to previous budget plans and wants management continuity at National Treasury.
Gigaba and his deputy, Sfiso Buthelezi, who was also appointed March 31, have met with the CEOs of Standard Bank Group, Barclays Africa Group, Nedbank Group and FirstRand and assured them there would be no shift in policy, the Banking Association of SA said on April 5.
Gordhan’s ouster as finance minister in a cabinet reshuffle led to S&P Global Ratings and Fitch Ratings cutting SA’s credit rating to sub-investment grade.
Moody’s Investors Service has put its assessment of SA’s debt, which is two levels above junk, on review for a downgrade on April 3.
Tshwete didn’t immediately respond to a phone call and text message Sunday seeking comment on Malikane’s appointment and role at the Treasury.
Read Fin24's top stories trending on Twitter: