In a statement from the presidency, Zuma said Nene, South Africa’s first black finance minister, did well in a hard situation.
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“Whilst we appreciate and respect that our Constitution gives the president the powers to make changes to the cabinet, we feel that the decision was ill-timed”, Cosatu said in a Fin24 report.
South Africa’s currency dipped to an unprecedented low against the USA dollar after the country’s finance minister was suddenly fired.
Fitch downgraded Africa’s most advanced economy to just one notch above sub-investment grade, citing the slowing economy and rising debt. The new finance minister is a relatively unknown politician, David van Rooyen, who is likely to prove obedient to Mr Zuma.
The rand has lost nearly 30% of its value against the dollar so far this year.
“President Zuma has failed to take the necessary action to rescue our economy or to take the decisions that conserve our fiscal stability, and has instead removed the minister who showed signs of fiscal prudence”, federal leader of the opposition Democratic Alliance party Mmusi Maimane said in a Thursday statement. “We want to demystify some of the myths that are now prevailing around the functionality of this important department… the national treasury is the axis of our development agenda”, said Van Rooyen in a brief address.
The planned nuclear contract, potentially costing as much as $100-billion (U.S.), has been widely criticized as an insider deal under Mr. Zuma’s direct control.
He also stated that van Rooyen’s involvement with Umkhonto we Sizwe (MK) could point to his replacing of Nene being politically driven, and that questions about his capability remain unanswered following a disastrous spell as Mayor of the struggling Merafong Local Municipality in Gauteng two years ago.
“Tonight’s firing of Nhanhla Nene has already had profoundly negative effects on the rand which has plummeted since news of the announcement broke”.
Both independent prices, such as bond yields, and the Rand exchange rate are pricing in a bleak 2016 for South Africa.
The meeting in the resort town of Victoria Falls comes as party officials are split over improving ties with the International Monetary Fund to rebuild an economy blessed with diamond deposits, the world’s second-biggest reserves of platinum and chrome, after South Africa, and fertile farmland. He said that is aware he is facing a “colossal” assignment in his new job.
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Van Rooyen’s appointment has been viewed as a political deployment by political, economic and social commentators. The Russian government, which has forged close links to Mr. Zuma, is expected to win the contract to build as many as eight nuclear reactors in South Africa.
