South Africa's Central Bank Chief Urges More Risk for Growth
South African Reserve Bank Governor Lesetja Kganyago called for a shift from risk aversion to bold action to address years of poor economic performance. The nation has averaged less than 1% growth each year for over a decade. He criticized the focus on debating types of growth rather than achieving it, noting the country’s reluctance to embrace risk is slowing progress despite a cultural love for gambling. He urged a change in attitude, pushing for decisive steps in economic strategy.
Speaking at an event in Pretoria, Kganyago said the nation should stop betting on sports and instead focus on growth. He argued that South Africa must embrace calculated economic gambles to break free from stagnation and achieve meaningful progress. This, he said, requires a mindset shift toward taking risks to drive expansion.
Kganyago pointed to the long-term effects of Jacob Zuma's presidency, during which public institutions were repurposed for private benefit. He stated this damaged government capabilities, weakened state-owned enterprises, and caused ongoing local governance challenges. The former president's actions left a legacy of corruption and inefficiency, which continues to hinder the country’s progress and trust in state institutions.
The governor noted that recovery efforts, like those under President Cyril Ramaphosa’s Operation Vulindlela, are delayed by past damage. Progress has been made, but addressing long-term consequences is essential. He warned that without fixing these issues, building the institutions needed for economic progress will remain difficult.
Kganyago emphasized that South Africa’s focus on terms like 'jobs-rich' or 'pro-poor' growth is counterproductive. He argued that the idea of 'growth with adjectives' should be eliminated, and the nation should simply aim for growth, even if it involves risks. Rather than debating the kind of growth desired, he called for a more straightforward approach. 'Just go for growth,' he said, noting the country should not overcomplicate the process.
Kganyago urged the nation to move beyond defining growth and instead focus on progress, regardless of the outcomes. He warned that the obsession with defining growth is preventing bold decisions needed for recovery. Just go for growth.'