Anglo American said the new system would provide SA companies, including Anglo American, with increased flexibility to manage cash resources to optimal effect. Photo: Rodrigo Garrido/Reuters
Anglo American said the new system would provide SA companies, including Anglo American, with increased flexibility to manage cash resources to optimal effect. Photo: Rodrigo Garrido/Reuters

Anglo American welcomes Mboweni's promise to modernise S Africa's exchange controls

By Dineo Faku Time of article published Feb 28, 2020

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JOHANNESBURG – Anglo American on Thursday welcomed Finance Minister Tito Mboweni’s Budget plans to modernise South Africa’s exchange controls.

Anglo said the new system would provide South African companies, including Anglo American, with increased flexibility to manage cash resources to optimal effect.

Anglo chief executive Mark Cutifani said the adoption of a risk-based capital flow management system supported South Africa’s economic growth and investment goals and was a further positive step towards building South Africa’s attractiveness as a globally competitive investment destination.

“We believe in the clear benefits of the government continuing to implement effective policy measures that are supportive of attracting investment to spur the economy for the benefit of all South Africans, adding that mining was a critical driver of economic growth, transformation and development.

“We see considerable opportunity for South Africa to compete more effectively for global investment in its precious natural resources which can then help deliver a more prosperous South Africa,” said Cutifani.

He noted that certain exchange control conditions previously applicable to it would be aligned to the current foreign direct investment criteria.

“In terms of the new system for capital flows that will align South Africa’s approach with international best practice, Anglo American will engage with the South African Reserve Bank and National Treasury in respect of how it will apply to its business in South Africa,” Cutifani said.

In the 2020 Budget review, National Treasury said South Africa’s foreign-exchange control system would be modernised over the next year to support investment and the country’s position as a hub on the continent.

The review said over the next 12 months, a new capital flow management system would be put in place.

“All foreign-currency transactions will be allowed, except for a risk-based list of capital flow measures summarised in the box overleaf. This change will increase transparency, reduce burdensome and unnecessary administrative approvals, and promote certainty,” said the Budget Review.

BUSINESS REPORT

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