There was a development this past week that did not receive the media coverage and outrage it should have.
Khumbudzo Ntshavheni, the Minister in the Presidency, launched an attack on the private sector and said Standard & Chartered’s confession that it manipulated the exchange rate of the rand proves the private sector sought the collapse of the government.
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Read: Standard Chartered settles forex rigging case after eight years in court
“We have maintained over the period that the performance of the rand and sometimes the performance of the economy has been manipulated by [the] private sector [who] has no interest in the development of this country, who continue to engineer and do machinations and to make sure that the government collapses.
“That is why they [the private sector] also self-feed in the narrative that there’s a collapsing state, there’s a collapsing economy because that’s what they wish for, and their actions do that,” she said.
Little media coverage
Apart from a few short articles and social media posts, her remarks did not elicit a significant reaction. It may be that many commentators merely brushed off the remarks as another brain fart of a cadre.
But Ntshavheni is not a nobody. She is a senior minister in President Cyril Ramaphosa’s inner circle.
As minister in the presidency, she is responsible for state security, the Government Communications and Information Systems (GCIS) and Statistics South Africa.
She was a former minister of communications and small business development and was responsible for performance monitoring and evaluation in the presidency. She is also one of the most academically qualified ministers. She holds an MBA from the University of Bradford in the UK and several postgraduate qualifications from the former Rand Afrikaans University in Johannesburg.
Before becoming a member of parliament, she was the youngest municipal manager in South Africa (Ba-Phalaborwa), chief operations officer at the State IT Agency and, according to the government’s website, a successful entrepreneur in various sectors including agriculture, FMCG, ICT and transport before becoming a member of parliament.
Confidence of the president
She obviously has the confidence of the president, as she accompanied the economic heavyweights Finance Minister Enoch Godongwana and Minister of Trade and Industry Ebrahim Patel to the United States to convince sceptical American politicians that South Africa is totally unaligned in the Ukraine war and to secure the country’s continued inclusion under Agoa.
Her unprovoked attack, in response to a neutral question from a journalist, is therefore highly problematic.
Presidency spokesperson Vincent Magwenya came to her defence afterwards, saying her comments were taken out of context.
“Unfortunately, the minister’s statements weren’t properly captured in their whole context. But I think the minister has attempted to clarify her comments. We cannot use a horrible practice by individuals in financial institutions to tarnish the entire banking sector. Secondly, we cannot tarnish the entire private sector.”
Read:
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[A transcript of Ntshavheni’s complete statement is included at the end of this article to remove any notion that she was quoted out of context]
Magwenya is 100% correct. Standard & Chartered’s conduct does not represent the conduct of the banking and private sectors. If the bank and all the other banks are guilty of manipulating the exchange rate, they must be punished to the full extent of the law.
Totally wrong
But the most significant aspect is that Ntshavheni is wrong. The private sector is not trying to collapse the government. The government has done an excellent job of destroying the state’s capacity without the assistance of the private sector.
In fact, the private sector and several of South Africa’s top business leaders are instrumental in trying to pick up the pieces to ensure a sustainable, inclusive economy.
More than 115 CEOs from many of South Africa’s most prominent companies have signed a pledge to offer their skills to the government to help alleviate the many crises that the country faces.
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Under the guidance of Business Unity South Africa and Business4SA, the private sector and government have formed joint workstreams to fix Eskom and Transnet and reduce crime and corruption.
Many mining groups also work with Transnet (at a significant cost) to improve efficiencies. Farmers are fixing roads, business groups are restoring decaying water infrastructure, and private sector firms are repairing potholes. The list is long.
Growth Lab report
Ntshavheni’s lapse of reason did not end there. She also ignorantly rejected the Harvard Kennedy School’s Growth Lab report, which found that the “collapse of the state” is directly responsible for South Africa’s pedestrian economic growth, high unemployment and fiscal problems.
The Growth Lab is one of the leading institutions researching why developing countries’ economies fail. The research took two years to complete and included numerous interactions with representatives of all spheres of South African society.
Ntshavheni justified the rejection by saying that the “sample” wasn’t “wide” enough and that she has experience because: “I’m stuck with research and sample and my professors telling me that the sample is not wide enough, is therefore not reliable and therefore what and that’s why on our part we are not bothered about the reports in terms of things that they say are happening, which are not necessarily happening. On things that need to strengthening, we are strengthening.”
South Africa deserves better.
Below is the full transcript of Ntshavheni’s remarks. Watch the full video here. The remarks related to Standard Chartered start at 42:45 and related to the Harvard report at 43:09).
Khumbudzo Ntshavheni, the Minister in the Presidency:
“On the Standard and Chartered Confessing to collusion, it’s a very sad state. We have maintained over the period that the performance of the rand and sometimes the performance of the economy has been manipulated by [the] private sector [who] has no interest in the development of this country, who continue to engineer and do machinations and to make sure that the government collapses.
That’s why they also self-feed in the narrative that there’s a collapsing state, there a collapsing economy, because that’s what they wish for and their actions do that. But despite those efforts, the South African economy continue to be resilient.
And in terms of the work that is being done, the competition commission, Standard and Chartered has agreed to testify against the other Banks. So the follow-up question that you’ve said to say what is the role of Absa and other Banks, not only one bank, the other banks at least now we’re starting to have Standard and Chartered going to form part of the witnesses in the prosecution so that we can have recourse. People cannot be left untouched because they wanted to collapse this country. There must be consequences and there will be consequences.
On the Harvard research. I think so how do I say it… it was initiated by this government through the national in partnership with the national treasury. But research on its own is not absolute. It consider a period, it consider it considers… a sample and I can say this because I’m stuck with research and sample and my professors telling me that the sample is not wide enough, is therefore not reliable and therefore what and that’s why on our part we are not bothered about the reports in terms of things that they say are happening which are not necessarily happening on things that need to strengthening, we are strengthening.
Listen to this FixSA podcast with Jeremy Maggs (or read the transcript here):
You can also listen to this podcast on iono.fm here.
