Jacob Zuma has tightened his grip on the finance ministry, the state prosecutor, the public protector and the tax authorities. All of them, to one degree or other, are amenable to his preferences. Now South Africa’s president is trying to go one better: he wants to take over the country’s money printing presses. Busisiwe Mkhwebane, the public protector, far closer to President Zuma than her combative predecessor, recommended this month that parliament make an ever-so-tiny adjustment to the central bank’s constitutional mandate.
As well as worrying about keeping prices in check, she suggested, it should also pay attention to growth and “meaningful socio-economic transformation”. Roughly translated, the mandate would read: “Keep interest rates low forever. In extremis, press button marked ‘Print’.” It is a carefully thought-out set of instructions perfected in Zimbabwe. The central bank, one of the few truly independent institutions left standing, this week fought back. It filed a suit with the Pretoria High Court to protect the rigour of its mandate. The bank says, rightly, that transforming the lives of the poor cannot be achieved without price stability. Low and stable prices are not sufficient to deal with the legacy of apartheid, which created a vast black underclass. The past 23 years, in which the African National Congress has failed to bring jobs and opportunity to millions, have demonstrated that. But the alternative – high inflation and its dreaded cousin hyperinflation – is no basis on which to improve anyone’s life. The assault on the bank is, potentially, another notch downwards for a country whose descent under Mr Zuma into crony capitalism has been arrested only by institutions prepared to stand up for the constitution and the rule of law. They include the courts, the finance ministry that was, the public protector that was and – in its own unflashy way – the central bank. As in the US, where institutional credibility is also under assault, in South Africa too it has not been a one-way street. Some institutions have bolstered its credentials as being different from most African countries, where the interests of state and the ruling party have merged. In South Africa, the courts have passed judgments inimical to Mr Zuma, such as when the high court in North Gauteng revived 783 charges of fraud, racketeering and corruption against him. The Pretoria High Court may well back the central bank.
As in the US, the importance of personalities, as well as institutions, has come to the fore. Acting attorney-general Sally Yates stood up to President Donald Trump over his travel ban. In South Africa, Thuli Madonsela transformed what had been the low-key ombudsman’s office into a shield of constitutional probity. Not only did she blow the gaffe on Mr Zuma’s use of R246m ($19m) of state funds to upgrade his homestead; she also, in her last act of defiance, published a damning report into “state capture”, in which she detailed the alleged lengths Mr Zuma was prepared to go to satisfy the business interests of his friends, the Guptas. Mr Zuma and the Gupta brothers, who own media and mining assets, have denied those allegations. Since the report, Ms Madonsela and Pravin Gordhan, a beyond-reproach finance minister, have left the scene, replaced by individuals less likely to cause Mr Zuma trouble. Yet the fight between South Africa’s institutions and the ransacker-in-chief is not over. Now the battle has shifted to the other key institution whose conduct will, ultimately, shape South Africa’s future: the ANC. The party that inherited the moral authority of the anti-apartheid struggle will, in December, elect a leader to replace Mr Zuma. The choice will help determine whether the ANC continues its descent or whether it can again become a party with the stature to tackle the country’s corrosive social and economic problems. Mr Zuma wants Nkosazana Dlamini-Zuma, his former wife, to take his place. His preference ought to raise alarm bells. Ranged against her is Cyril Ramaphosa, a businessman, former trade union leader and now deputy president. Mr Ramaphosa has his issues, not least the fortune he amassed under black empowerment and his position on the board of the London-listed company Lonmin when 34 striking miners were shot and killed at Marikana in 2012. Depending on who wins and what they do, the ANC could still reverse course. Its first duty would be to restore institutional independence in full. If it fails to halt its own decline, it may only be a matter of time before the presses start rolling.
Published in Daily Times, July 3rd , 2017.