Page 196 - SARB: 100-Year Journey

Gill Marcus, Governor, 2009–2014
Gill Marcus became the ninth Governor of the SARB in 2009. She relinquished her role as the Non- executive Chairperson of Absa, one of South Africa’s largest commercial banks, to assume her duties as Governor.
Marcus had previously served one, five-year term as Deputy Governor between 1999 and 2004. Before then, she had been Deputy Minister of Finance, starting in 1996.
Governor Marcus was born in 1949 and grew up in Johannesburg, where she completed her schooling. She enrolled for a BCom degree at the University of the Witwatersrand but changed courses and studied towards a degree in industrial psychology. However, during the course of her studies her parents, who were active in the ANC and were members of the then banned Communist Party, went into exile in London in 1969. Marcus completed her studies while in London through distance-learning institution, the University of South Africa.
In 1990, after the unbanning of the ANC and other political organisations, Marcus returned from exile and took up a post in the ANC’s Department of Information and Publicity, where she quickly became one of the party’s more prominent voices. In July 1991, she was elected into the ANC’s National Executive Committee and was co-opted to the party’s National Working Committee.
After the 1994 general election, Marcus was appointed to the Constitutional Assembly and chaired the Joint Finance Committee. She then became Deputy Minister of Finance in 1996.
Marcus assumed the governorship of the SARB in the wake of the 2008–09 global financial crisis. South Africa fared better than most emerging-market economies, but the real economy lost a million jobs and experienced a recession. As the country struggled to revive economic growth rates to pre-crisis levels, her tenure saw more external debate about the suitability of inflation targeting as a policy choice. The critics argued that the policy impeded growth.
Since monetary policy is set by the Minister of Finance in consultation with the SARB, this is a debate Marcus did not often engage in, although she chose suitable platforms to offer clarity and to respond to some of the public criticism.
Speaking at the Biennial Conference of the SARB on ‘Fourteen years of inflation targeting in South Africa and the challenge of a changing mandate’, Marcus said: “Although our inflation target of between 3 and 6 per cent is higher than the advanced economy norm, this does not mean that there have not been times when there have been calls to raise the inflation target, even from the current high level, in order to bring about a looser monetary policy stance.
“Our current level of inflation and our target are not close to the low inflation trap, and our view is that a higher inflation target would merely raise inflation expectations, and actual inflation would then likely increase. The end result would be higher nominal interest rates, and because of possible higher inflation variability and other risk premia, we could end up with higher real interest rates as well.”
Today, inflation targeting remains official monetary policy.
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