Public enterprises, greylisting and Brics were central to President Cyril Ramaphosa’s question and answer session in parliament on Thursday.
He said that discussions with the treasury were underway to review the budget to get South Africa off the grey list. Countries on the grey list are those with deficiencies in combating money laundering and terror financing.
He also reiterated his intention to dissolve the public enterprises department and to return the state-owned enterprises to their respective line function departments.
“As I said in the State of the Nation address, the presidency and national treasury will work together to rationalise government departments, entities and programmes over the next three years.”
This was his first question and answer session of 2023 and it came after he finally filled critical vacancies in his executive on Monday.
During the session Inkatha Freedom Party (IFP) MP Mkhuleko Hlengwa asked about South Africa’s greylisting and what interventions the Brics (Brazil, Russia, India, China, and South Africa) countries will come up with to assist South Africa and other African countries that have been listed.
South Africa will host the leaders of the Brics countries at the 15th Brics Summit from 22 to 24 August 2023. South Africa will chair Brics this year. All of the Brics countries sit on the Financial Action Task Force (FATF), which monitors countries on the grey list.
South Africa was greylisted in February, along with Nigeria, and joined other African countries such as Mozambique, Tanzania, Uganda and Senegal.
Ramaphosa said that as the Brics chair and as South Africa, part of ensuring that other African countries are removed from the list is through advocacy.
“In terms of our own relationship with various other countries on the continent we obviously continue to raise some of these issues of good governance nature, good legislative nature. This [being greylisted] has clearly given us an opportunity to look at ourselves but also to play an advocacy role in relation to the various other sister countries on the continent”.
Ramaphosa said the minister of finance sits on the African Union committee that is tasked with tackling the issue of greylisting and that discussions of budget gravitating in that area have commenced.
“We are going to be focusing on the issues that have been raised by the Financial Action Task Force, so that all of us can get out of that group of countries.”
The watchdog has pointed to a need to increase criminal investigations, prosecutions and asset recovery in money-laundering and terror-financing cases in South Africa.
“The issue of greylisting is of great concern to all of us as South Africans. Our treasury team worked very hard to ensure that we reduce the number of concerns that have been raised.”
In his budget for 2023, which was presented just two days before the news that South Africa was greylisted landed, Finance Minister Enoch Godongwana allocated an additional R265.3 million to the Financial Intelligence Centre.
Regarding his reshuffled and bloated cabinet, Ramaphosa reiterated that there will be reconfiguration and, specifically, that there has been significant progress in restoring good governance at state-owned enterprises (SOEs).
The president said the process of reconfiguration takes the overall approach that SOEs operating in specific sectors should be placed under the relevant government department. This is the case for most SOEs; the only exceptions are the seven SOEs that are in the portfolio of the public enterprises department, he said.
He said a state-owned holding company will be established to house strategic SOEs and to exercise coordinated shareholder oversight. Policymaking and regulation will reside in the relevant department.
“A state-owned holding company will enable streamlined governance processes, transparent financial systems, economies of scale and adequate funding so that SOEs can fulfil their respective mandate,” he said.
