President Jacob Zuma appointed Pravin Gordhan as finance minister on Sunday, in a dramatic U-turn that gave South Africa its third finance chief in a week after a selling frenzy in the markets. The shock announcement restoring Gordhan to the post sent the rand surging nearly 5 percent on Sunday evening, but failed to quell a tide of criticism of the president.
“This is reckless by President Zuma, he is playing Russian roulette with the South African economy,” opposition Democratic Alliance leader Mmusi Maimane said.
Zuma sacked Nhlanhla Nene from the ministry late on Wednesday, sparking a wave of criticism and financial turmoil, and replaced him with the relatively unknown lawmaker David van Rooyen. The removal of Nene, who was keen to rein in government spending in Africa’s most industrialized economy, sent the rand currency to record lows, sparked a sell-off in bank stocks and sent yields in both local and dollar-denominated debt soaring.
Nene’s reluctance to rubber-stamp an ambitious plan to build a number of nuclear power stations to ease severe electricity shortages, a project that might cost as much as $100 billion, is also seen as contributing to his downfall.
“On the 9th of December 2015, I announced the appointment of a new Minister of Finance, Mr David van Rooyen,” Sunday’s statement from the presidency said.
“I have received many representations to reconsider my decision. As a democratic government, we emphasize the importance of listening to the people and to respond to their views.” Read more