Page 144 - SARB: 100-Year Journey

“He [De Klerk] supported me against his Cabinet ministers. We had a two-hour meeting and a long debate. At the end of the meeting, when I walked out, Mr De Klerk looked at me and said, ‘Mr Governor, we shall read with interest in the newspapers what you decide, when you decide about the interest rates.’”
“That was his answer to me: ‘Do not bring it to Cabinet again. You will decide in the SARB with your colleagues, the Governor’s Committee.’”
Van der Merwe offered an insider’s perspective on how these changes materialised within the SARB’s corridors as they related to Stals’s’ leadership of the institution.
“In the management of the Bank, he [Stals] ... introduced many improvements such as the determination of a specific mission. Part of the financial stability function also became a function of the Bank during his period of governorship,” said Van der Merwe.
During this period, Van der Merwe was most proud “... to have been involved in the development of the repo system towards the end of 1988, which was also quite an important change in the way the Bank provides accommodation to private banks.”
Rossouw concurred with Stals’s views that: “Mr De Klerk allowed the central bank more autonomy and independence than Mr Botha.”
Prof. Jannie Rossouw. /SARB
“So, it’s not only the Stals appointment [that was a defining moment in 1985−89], it’s also the Botha-to- De Klerk change that ushered in a new dispensation,” Rossouw explained.
When De Klerk’s administration began loosening the apartheid state’s grip on the SARB, it did the same in the broader South African society.
On 2 February 1990, President De Klerk gave a historic address at the opening of Parliament which would change the future course of South Africa. De Klerk announced that political prisoners, including Nelson Mandela, would be freed, and political parties and other organisations would be unbanned.
There was more.
“We had the referendum which took place in March 1992, which was basically [asking] if everybody was in favour of fully democratic elections where we wanted one person, one vote. That was a resounding success with those who said ‘yes’,” Cross said.
The referendum was restricted to white South Africans. A total of 60% of participants voted in favour of democratic elections. South Africans in exile, who had fled the country to escape the brutalities of apartheid and would later come back to serve in the rebuilding exercise, including at the SARB, were in disbelief. This is explored further in the segment ‘The transition to 1999’.
Meanwhile, the unconventional and peculiar dynamics between the SARB and the apartheid regime, as detailed by Stals, can, arguably, be used to draw critical inferences about the SARB’s tame approach to high inflation in the 1980s. Incidentally, Stals made fighting inflation one of the defining themes of his two terms as Governor (1989−1999).
“I learnt at an early stage, perhaps from my Dutch teacher in Money and Banking at the University of Pretoria, Professor Wijnholdts, that a central bank’s main function is to fight against inflation.”
Dr Chris Stals
Former Governor of the SARB
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