Treasury still on track, Gigaba assures investors

With just less than two weeks on the job as finance minister, Malusi Gigaba has tried to allay investors’ fears that all is lost. He says they shouldn’t be alarmed.

Ahead of a crucial International Monetary Fund meeting in Washington DC in the US, next week, Gigaba tried to curry favour and quell investor fears that the country was treading in deep financial waters.

The meeting in Cape Town earlier on Thursday was with asset managers, bondholders and investors.

Despite significant and severe downgrades by international ratings agencies, Gigaba said Treasury was still on track.

The downgrades of late are arguably a clear indication that confidence has been lost following the axing of former finance minister Pravin Gordhan and his deputy Mcebisi Jonas, among other Cabinet reshuffles.

“As critically important as foreign investment is, our local investment pool is equally important, and is a real strength for South Africa as a developing country.

“You’ve seen them [the downgrade reports] and will be well aware of the issues they have raised as concerns … We fully appreciate the gravity of the downgrades,” he said, adding that it was a setback but in coming weeks investor confidence would be on the mend.

“We are fully aware of the negative impact ratings downgrades can have on government’s ability to borrow affordably, and on the private sector’s ability to attract foreign investment,” he said.

“We want management continuity at National Treasury. It is a strong, professional and stable institution, and we want to keep it that way. We are happy with the skilled and experienced team we found here, and trust they will remain, as patriotic civil servants who are appointed permanently or on long-term contracts, and do not come and go when political principals change.”

Before the reshuffle, director-general of the ministry of finance Lungisa Fuzile, who was a crucial cog in the wheels of Treasury, informed Gordhan that he was packing his bags.

“…I want to assure you that we are laser-focused on inclusive growth, so that we can develop South Africa into a country in which all of its people thrive,” said Gigaba.

“Even as we recognise the robust political debates taking place, we are determined to unite South Africans around the programme of inclusive growth,” said Gigaba.

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