Speaking at the Sarb's annual general meeting in Pretoria, Kganyago explained that this withdrawal would help manage the government's debt-servicing costs.
In February 2024, the Sarb introduced a new Gold and Foreign Exchange Contingency Reserve Account (GFECRA) framework, which allows the government to tap into these funds to reduce debt issuance.
In June, the Gold and Foreign Exchange Contingency Reserve Account Defrayal Amendment Act was gazetted. This was accompanied by the signing of the GFECRA settlement agreement between the Sarb and the Minister of Finance.
Kganyago said, as of 1 July, R100bn had been transferred to the Sarb, and roughly three quarters of the R100bn due to National Treasury this year has already been paid out.
The transfers are expected to be complete by mid-August.
In tabling the 2024 budget, Finance Minister Enoch Godongwana said GFECRA had grown to over half a trillion rand, up from less than R2bn in 2006.
The new GFECRA framework, Kganyago said, will strengthen the Sarb's capital position and will ensure that, among other conditions, the Sarb’s solvency is not undermined by any GFECRA profits distribution.
This means that while the government can access some funds, a portion is retained to maintain the Sarb’s strong capital position and to ensure there are sufficient resources to handle financial crises.
"These distributions will be used to reduce government borrowing. There will be no sales of foreign exchange reserves if such reserves are below estimated adequacy levels," Kganyago said.
As of February 2024, government's debt had reached R5tn.
