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Mboweni to decide on rand's strength
Boyd Webb | Pretoria, South Africa
11 August 2004 16:33
The interests of the country will be central to any decision on the strength of the rand, South African Reserve Bank (SARB) Governor Tito Mboweni said on Wednesday.
"We will take a decision quite clearly in the interests of what we think South Africa deserves," he told mine and textile workers protesting in Pretoria against job losses resulting from the currency's strength.
The protesters demanded that the rand be reduced to between R7,50 and R9 to the United States dollar.
Addressing about 2 000 members of the National Union of Mineworkers (NUM) who marched to the bank in Pretoria, Mboweni said the issue raised is very serious and requires a serious response.
Mboweni said he will respond to the demand within the stipulated 14 days, following "discussions with colleagues".
The march was organised by NUM and supported by the South African Chamber of Mines, the South African Communist Party, the South African Clothing and Textiles Workers' Union (Sactwu), Solidarity and the Congress of South African Trade Unions (Cosatu).
A memorandum was handed to Mboweni and it demands a response within 14 days.
NUM secretary general Gwede Mantashe said the SARB should stabilise the rand to protect jobs in the mining and export sector. A range of R7,50 to R9 to the US dollar is best.
"Any weaker than that would again be detrimental," he said.
The memorandum blames the strong rand for the loss of more than 10 000 jobs in the mining sector over the past 12 months.
"Marginal shafts are run at a loss. Greenfield projects have been stopped and new jobs promised in the Growth and Development Summit [held in 2003] have not materialised," said NUM president Senzeni Zokwana.
He accused the SARB of "mismanaging the countries resources" by creating a strong rand.
Sactwu vice-president Violet Seboni said that in the past year 20 000 jobs have been lost in the textile industry.
The unions also criticised the government's relationship with China, which has seen textile exports to South Africa rocket over the past 12 months.
The memorandum called for the reduction of interest rates, aggressive purchasing of foreign reserves -- which Frans Bakker, senior executive of the South African Chamber of Mines said are running very low -- and the relaxing and removal of exchange control.
The protesters lashed out at retail groups whom they claimed are profiteering from the strong rand.
"We are convinced that it requires the commitment from all of us to contribute towards achieving the set goals of halving unemployment and poverty by 2014," Zokwana said.
Despite an alarmed expression on his face at the request to reduce the rand to R7,50 or more to the dollar, Mboweni reaffirmed the matter will be investigated.
At least "the unions come in daylight" he said, noting that they have not been the only parties calling on him to reduce the rand's strength.
"... Others come wearing pin-striped suits and park their cars in garages and arrive in lifts unseen and unheard and they raise the same issues," he said.
The march was supported by individuals from mining houses.
Nick Smythe, senior manager at Goldfields, and Jackie Mathabula from Harmony joined the protesters in their suits as they marched towards the bank.
Both agreed the rand is doing more harm than good.
"The Chamber of Mines recognises the independence of the SARB but at the same time it must realise the chamber also has a position," Smythe said.
Bakker said the South African Chamber of Mines is fully behind the protest and its call to reduce the rand's strength. -- Sapa
