Four days after a public outcry and subsequent plummeting financial markets, president Zuma replaced Van Rooyen with a much more experienced Pravin Gordhan as finance minister, which saw the Rand recover steadily.
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As people came out to protest, the ANC said that while they supported the people’s right to demonstrate, they did not share their views that Zuma should resign.
The rand firmed to 14.9575 against the dollar on Tuesday, a gain on the day of 1 percent, but still short of recapturing all the ground lost after Nene’s shock exit.
ANC spokesperson Zizi Kodwa said a number of hoax statements had been doing the rounds, saying Zuma had been recalled.
Nene, who economists say was an advocate of fiscal discipline, was replaced by a little known lawmaker – a move that freaked out markets and angered many South Africans.
She was giving feedback on a national working committee of the African National Congress, squashing rumours on social media that Zuma had been recalled as president. At 1500 GMT, the yield on the benchmark paper due in 2026 had shed 45 basis points to 9.55 percent. “But it is certainly unreasonable to expect all of last week’s losses to be reversed – a huge amount of uncertainty has been created in the past few days”.
“Minister Van Rooyen is no stranger to local government; he was head of the South African Local Government Association (SALGA) in the North West and former executive mayor of the Merafong Municipality, a history which is of great concern to us”.
Rakgwale said the president had used tax payer’s money for wasteful purposes and the country was now going down the drain.
“The country is presently at a critical juncture, economically, which urgently requires leadership to stabilise the markets, to reassure investors and avoid further damage to an increasingly fragile economy”, said Dr Van Zyl.
“Markets should rally back very strongly but I would not expect a total retracement with a permanent loss of trust in leadership even if we are in a better place”, said Peter Attard Montalto of Nomura in London.
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The debacle over finance ministers triggered a market rout and fuelled opposition to Zuma, who has been buffeted by corruption scandals, a dire economy and charges of tarnishing Nelson Mandela’s legacy. However a leopard doesn’t change its spots. We will still have high unemployment and high debt. Before the events of last week we expected Namibia to raise rates three times next year (i.e. 75bps).
