Chief Economist at Stanlib Kevin Lings says the government needs to provide clarity about its decision to establish a sovereign wealth fund.
President Cyril Ramaphosa made the announcement during his State of the Nation Address in parliament on Thursday. But he did not provide details on how the fund would be financed.
Lings says the country already has some agencies that are equipped to develop the country, making a sovereign wealth fund unnecessary.
“So if you look at countries that have sovereign wealth fund, they tend to be able to put proceeds from oil. So if you look at Norway they have a big sovereign wealth fund all coming from oil. We don’t have that type of proceeds.”
“What are we trying to achieve with the sovereign wealth fund that one of our development agencies can’t already do. If we look at the rage of agencies we’ve got the IDC, the Land Bank, the Development Bank, those are all geared to develop this country.“
“What do we want to sovereign wealth fund to do that those agencies can’t do and how are we going to fund it, so there are a lot of question marks.”
President plans to revitalise economy, Click video below:
Source: SABC News (sabcnews.com)