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South Africa’s Top Banking Executive Commend Ramaphosa On Graft

South Africa’s Top Banking Executive Commend Ramaphosa On Graft

South African President Cyril Ramaphosa is making inroads with his crackdown on corruption that became endemic during his predecessor’s almost decade-long rule, according to the continent’s biggest bank.

“I’m very confident that he is winning the battle,” Lungisa Fuzile, the chief executive of Standard Bank Group Ltd.’s South African unit, said in an interview with Bloomberg TV.

“The speed may not be what we wish for, but these issues are very complex. The fight against corruption is well underway.”

Since taking office in 2018, Ramaphosa has made new appointments to crime-fighting institutions that were hollowed out under former President Jacob Zuma. He also appointed new executives to state-owned companies that have collapsed under mismanagement and graft.

A special investigating unit this month arrested Ace Magashule, the secretary-general of the ruling African National Congress, making him the highest-profile serving politician to face charges since Ramaphosa’s rise to power.

“The evidence is very abundant,” Fuzile said. The hope now is that “successful prosecutions” will follow arrests made across the country, he said.

In addition to the crackdown on corruption South Africa needs to accelerate reforms among its ailing state-owned companies that are key to the functioning of the economy, such as Eskom SOC Holdings Ltd.

The indebted utility has battled to keep power supply stable, even while demand was lower during the worst of the country’s lockdown earlier this year.

While a process to improve efficiency by splitting Eskom into three units has started, it must be accelerated, Fuzile said. “You can never drive a modern economy with energy supply that keeps on being disrupted. It’s not good for confidence.”

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Simultaneously, the government should wrap up issues around South African Airways, the national airline, which is small and not critical for growth, he said.

South Africa is pursuing an infrastructure drive and planning to open up various bid windows, including the latest round of a renewable energy program, to boost an economy that the National Treasury expects will contract 7.8% this year.

Efforts by the private sector and the government helped to kick-start a loan-guarantee program to assist businesses hit by Covid-19 and must be replicated to get other bankable projects going, he said.

“The ability of the capital markets to respond appropriately when required is beyond reproach,” Fuzile said. “All you need to do is set the policies right and be clear about the contracting processes.”
© Bloomberg

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