/ 20 May 2013

SA scraps sovereign wealth fund plans

Sa Scraps Sovereign Wealth Fund Plans

"The creation of a sovereign wealth fund is best timed with stable or rising commodity prices," Economic Development Minister Ebrahim Patel said in a written reply to a parliamentary question published on his ministry's website on Monday.

"In light of current market conditions, no immediate steps are contemplated." 

The ministry proposed the fund in 2010 as part of its new growth path, a development plan that called for steps to prevent the rand from being uncompetitive and for the fund to manage foreign reserves "more actively." 

The rand has dropped 11% in the past year, while gold has slumped 15% and platinum has declined 1.2%. South Africa is the world's largest producer of platinum.

Metals and other commodities accounted for 53% of South Africa's exports in 2012, according to government data. – Bloomberg