The Democratic Alliance (DA) has announced it would be submitting an application to the office of National Assembly Speaker Baleka Mbete, to debate a motion of no confidence in President Jacob Zuma.
Advertisement
Newly appointed minister of finance, Pravin Gordhan, speaks during a news conference in Pretoria, South Africa, Monday.
“One thing positive that came out of this crisis has been a positive response from business following the president’s reversal of the appointment of finance minister”.
Many speculated that he fired Nene for refusing to approve the purchase of new Airbus jets in a controversial deal through a third party. This allegedly brought the anger of the airline’s chairwoman, Dudu Myeni, known as a close ally of Zuma.
CNN’s senior market economist David Rees remarked, “the dire financial position, coupled with high inflation and a fragile balance of payments position, all point to a further depreciation of the rand against the dollar in 2016/17”.
The BBC reported that the reason behind the removal of Nene could have been his reluctance to approve a plan to build several nuclear power stations, at a cost of up to $100 billion. The South African government has officially denied the reports. “He is actually panicking beyond comprehension as we speak”, he said.
Pravin Gordhan worked as the Commissioner of the South African Revenue Service from 1999 to 2009.
“We will stay the course of sound fiscal management”, Gordhan told reporters in a message created to reassure unnerved South Africans and foreign investors.
The rand also recovered in spectacular fashion after the news broke.
Bonds also responded positively, with the benchmark 186-rand bid at 9.3 percent from a close of 10.4 percent on Friday. After a lengthy briefing on the cabinet meeting, which made no mention of the firing of Nlhanhla Nene, he was asked: “Did the president give any indication that the finance minister would be replaced?” The rand plummeted to record lows.
Tito Mboweni, a former central bank governor and member of the party’s National Executive Committee, said in an interview with Bloomberg TV that “the president has handled this situation very badly”.
I have received many representations to reconsider my decision.
The radical left-wing Economic Freedom Fighters, led by populist firebrand Julius Malema, said Zuma had turned South Africa into a “joke” and a “banana republic”.
Advertisement
“I wish both ministers all the best in their new deployments”, Zuma said.
