Mobilising savings to stimulate the economy must be done in partnership
Growing South Africa’s savings pool cannot be achieved without a partnership based on trust between Government and the savings and investment industry.
This is according to Johan van Zyl, Chairman of the Association for Savings and Investment South Africa (ASISA) and CEO of Sanlam. He was speaking at the opening of the ASISA Assembly in Johannesburg today.
The Assembly attracted some 250 representatives from the savings and investment industry, National Treasury, the Financial Services Board (FSB), the JSE and organised labour. The aim was to collectively debate practical solutions to the challenge of increasing South Africa’s savings pool, protecting it, and then deploying it responsibly in support of the national development agenda.
“By finding a long-term solution to this vexed problem we will be creating a win-win situation not only for our industry, but also for Government, the private sector as a whole and the citizens of this country,” says Van Zyl.
Van Zyl firmly believes that the solution does not include Government getting involved in the provision of financial services.
He adds, however, that if in the context of South Africa’s unique challenges Government believes that it does need to get involved in providing solutions that will improve savings, this should happen in partnership with the private sector where the necessary infrastructure and expertise are already in place.
“Government’s real focus should be on ensuring regulatory and policy certainty. The aim should be to create a stable environment underpinned by level playing fields, which will encourage private sector initiatives to increase the country’s savings rate.”
Van Zyl points out that capital, both foreign and local, will sit on the sidelines and wait for clear signs of how it will be treated once it is committed. “We all know that uncertainty is the biggest disincentive to investments,” he adds.
He says South Africa has come to a major juncture in its history where increasing the growth rate of the economy in an inclusive way is imperative. Growing the savings pool and job creation are two critical components.
“The efficient provision of financial services has an important contribution to make in achieving this objective, and as ASISA we accept the challenge enthusiastically. We will therefore continue to support and participate in all initiatives that will take us forward on this road.”
However, says Van Zyl, a key requirement is regulatory certainty.
“While I agree that it is important for Government to set a firm course for our industry from a regulatory perspective, I need to caution against rushing changes that will have a significant impact on our industry, its intermediaries and our clients.
“While I maintain that in some instances our industry is being forced to swallow internationally prescribed medicine when it is not suffering from the same global cough, I am also exceptionally pleased about the fact that National Treasury and the FSB continue to engage with us proactively and frequently on issues that need to be addressed.”
A good example, according to Van Zyl, is the ongoing engagement around National Treasury’s policy document, A safer financial sector to serve South Africa better.
Van Zyl says ASISA has what it takes to partner with Government on issues of national importance such as stimulating the economy by increasing the savings pool.
ASISA is empowered by a mandate from an industry that manages assets of more than R4 trillion. This industry is considered the custodian of the nation’s savings and is recognised as one of the country’s biggest contributors to the national GDP.
“In three short years ASISA has grown from being the new kid on the block to a formidable partner at Government’s negotiation table. It is no surprise then that last year alone ASISA has had over 45 projects on the go at any given time. Running with these projects were 115 ASISA committees and working groups, supported by over 1 800 member representatives.”
The fact that all of these projects involved Government stakeholders, including National Treasury and the Financial Services Board, shows that ASISA is considered a key partner, says Van Zyl.
Topics debated in panel discussions at the ASISA Assembly included the following:
- Retirement and savings reform
- Making savings attractive
- South Africa as a fiancial services centre – a gateway to Africa
- Economic development in partnership
Association for Savings and Investment South Africa (ASISA)
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