LEVERAGING MONETARY POLICY TO SUPPORT THE TRANSITIONAL NEEDS OF SOUTH AFRICAN WORKERS

The document critiques the Just Energy Transition Partnership (JETP) for focusing on electricity infrastructure over economic diversification and worker needs. It argues that the South African Reserve Bank's (SARB) current inflation-targeting framework and operational independence hinder developmental goals. The author proposes a shift toward 'promotional' central banking, utilizing underexploited liquidity in the banking and retirement sectors—estimated at R52.41bn from banks and potentially R600bn from retirement funds via offshore limit reductions. Key recommendations include reforming the South African Green Finance Taxonomy (SAGFT), implementing mandatory climate risk disclosures, and using credit allocation tools such as targeted refinancing operations, green-differentiated capital requirements, and state investment banks.

• The Just Energy Transition Partnership (JETP) is deemed unsuitable for South Africa's developmental needs because it prioritizes electricity infrastructure and 'derisking' for private investment over economic diversification and worker-centric job creation.
• South Africa's current monetary governance, specifically the SARB's inflation-targeting framework and operational independence, is argued to be incompatible with widespread job creation and developmental ambitions.
• There is significant underexploited liquidity in the South African financial system that could be redirected toward a developmental agenda, including approximately R52.41bn from 10% of banks' ten-year average lending.
• The South African Green Finance Taxonomy (SAGFT) is criticized for limited uptake and for failing to sufficiently address the transition needs of workers.
• The author proposes that the SARB and National Treasury implement mandatory corporate transition plans and climate risk disclosures to improve the understanding of transition risks to workers.
• To support the transition, the paper suggests several credit allocation mechanisms, including targeted refinancing operations (TROs), green-differentiated capital requirements, and the establishment of state investment banks.
• South Africa is identified as a feasible hub for international solar PV module manufacturing due to its infrastructure and manufacturing value added, though it currently lacks competitive industrial output capabilities.
• The document highlights a critical shortage of affordable housing, with an estimated shortfall of 2.3 million houses, and argues that improving energy efficiency in this stock is a key climate mitigation opportunity.

APA

Morris, J. H. (2025). LEVERAGING MONETARY POLICY TO SUPPORT THE TRANSITIONAL NEEDS OF SOUTH AFRICAN WORKERS. Institute for Economic Justice. https://iej.org.za/wp-content/uploads/2025/02/IEJ-ClimateWorkingPaper-MonetaryPolicy2025.pdf

Chicago

Morris, John Hogan. LEVERAGING MONETARY POLICY TO SUPPORT THE TRANSITIONAL NEEDS OF SOUTH AFRICAN WORKERS. Institute for Economic Justice, 2025. https://iej.org.za/wp-content/uploads/2025/02/IEJ-ClimateWorkingPaper-MonetaryPolicy2025.pdf.

Wikipedia

{{cite report |last1=Morris |first1=John Hogan |title=LEVERAGING MONETARY POLICY TO SUPPORT THE TRANSITIONAL NEEDS OF SOUTH AFRICAN WORKERS |publisher=Institute for Economic Justice |date=February 2025 |url=https://iej.org.za/wp-content/uploads/2025/02/IEJ-ClimateWorkingPaper-MonetaryPolicy2025.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{morris2025leveraging, author = {Morris, John Hogan}, title = {{LEVERAGING MONETARY POLICY TO SUPPORT THE TRANSITIONAL NEEDS OF SOUTH AFRICAN WORKERS}}, institution = {Institute for Economic Justice}, year = {2025}, month = feb, url = {https://iej.org.za/wp-content/uploads/2025/02/IEJ-ClimateWorkingPaper-MonetaryPolicy2025.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }