S Africa central bank shouldn’t aid state companies: Governor

Bloomberg

Government companies in South Africa that have had billions of rand looted through a process known as state capture shouldn’t be bailed out by the central bank even as they pose a significant fiscal risk, Governor Lesetja Kganyago said.
“The challenge of dealing with too-big-to-fail SOEs, of combining cash injections with conditionality measures, needs to be dealt with by the elected authorities – as it has been in the latest budget from National Treasury,” Kganyago said in an emailed copy of a speech on Tuesday, referring to state-owned enterprises. The South African Reserve Bank’s “power to say no
was greatly enhanced by its independence,” he said.
At least seven state companies are “either on their knees or touching carpet” as institutions were damaged due to state capture, Public Enterprises Minister Pravin Gordhan said in February.