Home News Cyril defends plan for sovereign wealth fund

Cyril defends plan for sovereign wealth fund

77
SHARE

“We have a clear road map to restore Eskom’s financial and operational position and to place our entire energy sector on a new trajectory of sustainability.”

President Cyril Ramaphosa yesterday defended his recent proposal to establish a sovereign wealth fund for South Africa as an act of care towards future generations.

“Our decision to establish a sovereign wealth fund even at a time of great economic difficulty is an exercise of our responsibility to future generations,” he said in his reply to the debate on his State of the Nation address a week ago.

The proposal comes as the country is faced with the failure of state-owned enterprises, chief among them Eskom, and public borrowing threatens to bring the debt to GDP ratio to 80% by 2030.

Ramaphosa said he would not heed the call from some quarters to shut down Eskom, which alone has debt of R450 billion and routinely suffers outages equivalent to a quarter of its overall capacity.

“We will not, as some honourable members have suggested, simply switch off Eskom’s life support, for to do so would be to plunge our economy and our country into chaos.

“We have a clear road map to restore Eskom’s financial and operational position and to place our entire energy sector on a new trajectory of sustainability.”

Earlier yesterday, Mineral Resources and Energy Minister Gwede Mantashe rejected a suggestion that the size of South Africa’s national budget deficit argues against the establishment of a sovereign wealth fund.

“If you say you cannot do something because of a crisis, the result will be a deepening crisis,” he said, adding that it was a lesson he had learnt at business management school.

Ramaphosa has left it to Finance Minister Tito Mboweni to provide more detail about the planned fund, and a state bank, also mooted by the president in his opening address to Parliament.

In reply to his critics, Ramaphosa further said his government continued to support the adoption of a constitutional amendment to expressly allow land expropriation without compensation and would push ahead with plans to roll out national health insurance.

The president also told Parliament that in his view it was treasonous to deny that apartheid was a crime against humanity, thereby publicly repudiating former president FW de Klerk.

Apartheid

Ramaphosa said it was clear that apartheid was a crime against humanity even before the United Nations declared it such in 1973.

“They knew as they looked at this country that this was a country where a grave crime was being committed against the majority of the people of South Africa.”

Ramaphosa added that there was not a single South African alive who was not touched by apartheid.

“I would go as far as to say to deny this is treasonous.”

He was reacting to the bitter polemic that erupted after De Klerk compared apartheid to genocide and said he did not think it fell into the same category.

“Genocide is a crime,” De Klerk said.

His apparent equivocation on the issue sparked a political storm, with the Economic Freedom Fighters disrupting the opening of Parliament last week to demand that he be asked to leave the public gallery.

De Klerk on Monday issued an apology, and said he accepted that apartheid was indeed a crime against humanity.

He served as the country’s last white president and then as deputy president in the democratic government formed by Nelson Mandela after South Africa’s first all-race elections in 1994.