President Cyril Ramaphosa says conditions that will enable the creation of a Sovereign Wealth Fund do not currently exist. However, he assured the National Assembly that government remains committed to establishing one.
Ramaphosa was responding to questions for oral reply in Parliament, on Thursday. This was his first session under the newly formed, purported Government of National Unity (GNU).
“We are committed to create a Sovereign Wealth Fund and we believe that the architecture that we are putting together now will be able to assist us in building a Sovereign Wealth Fund. This we will be doing for future generations because it takes quite a while to build a facility like a Sovereign Wealth Fund.
“While conditions do not currently exist for the immediate establishment of a Sovereign Wealth Fund, this is an objective which we should continue to work towards. Such a fund could help to ensure that the national wealth of our country is effectively used to support economic and social development for years to come,” said Ramaphosa.
He said the Fund should be seen as both a contributor to economic development and as a vehicle through which the state can invest money that is in surplus.
The president suggested that the fund could contribute towards specific economic sectors, utilised to invest in other countries and companies.
“The fund in my view is the way to go and we now have better architectural opportunity to be able to do so rather than just to continue talking about it without knowing exactly how it will source money and how it will be structured,” he said.
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