27 June 2001
Following the decision of the South African Reserve Bank to lower the repo rate by a full percentage point, all four major South African banks cut their interest rates by 0,75%. The South African Communist Party (SACP) condemns this selfish action by South African banks. This action, also condemned by Tito Mboweni, is a vindication of the correctness of the SACP-led Campaign to Make Banks Serve the People launched in October last year. It is proof that South African banks have no interest in serving the overwhelming majority of our people.
Instead of passing the full benefit of a cut in the repo rate, South African banks are once more acting in their own narrow self-interest by not cutting their own interest rate by a full percentage point. High interest rates undermine reconstruction and development. High interest rates mean profits for the banks and their shareholders at the expense of affordable banking services and social investment.
This profit-maximising action by South African banks is despite increasing calls and anger at South African banks from all corners and sections of our country.
This action shows the need to intensify the Campaign to Make Banks Serve the People. In this regard, the SACP is working towards intensifying this Campaign through, amongst other things, the launch of a Broad Campaign Forum representing a wide range of organisations with an in making banks serve the people. Already more than 55 organisations have endorsed the Campaign and will be part of the launch in July.
Further, the SACP is pleased that despite initial objections by the Banking Council of South Africa, NEDLAC has now set a time frame for a National Summit on the Transformation and Diversification of the Financial Sector. According to a NEDLAC Task Team this Summit will be held by November 2001. This is an important step forward and victory for our Campaign. The NEDLAC Summit must ensure that appropriate discussions and decisions are taken on how to transform and diversify South African banks and the financial sector as a whole.
CONTACT
Mazibuko Kanyiso Jara
Department of Media, Information and Publicity South African Communist Party
Tel: 011 339 3621
Fax: 011 339 4244
Cell:083 651 0271
Email:sacp1@wn.apc.org