Zuma’s backtracking a warning to elite

President Jacob Zuma. File Photo: Gallo Images

Common sense has finally prevailed with the reappointment of Pravin Gordhan as finance minister by President Jacob Zuma.

Gordhan’s track record in the position he previously held for five years speaks for itself. The move had very little to do with Zuma’s willingness to “listen to the people and to respond to their views”.

Clearly Zuma buckled under pressure from several quarters, including his own party and its alliance structures, civil society, business and opposition parties. The move was carefully designed to revive investor confidence in the economy and to reassure financial markets rattled by the shock removal of Nhlanhla Nene as finance minister and the replacement of him with little-known David van Rooyen.

The rand immediately made a slight comeback after it had gone into free fall, hitting its lowest point to the dollar, hovering around R16. However, within hours of Gordhan’s appointment, the rand strengthened against other major currencies simply because Gordhan is generally respected by investors for prudent fiscal discipline.

It was widely speculated that Nene had been fired because he would not approve an expensive plan to renegotiate aircraft contracts proposed by SAA chairperson‚ Dudu Myeni, who reportedly has close links to Zuma.

Yesterday Gordhan hit the ground running, tacitly warning Myeni that a situation where state-owned entities are “toys for personal gain” will not be allowed.

“It is time individuals or groups of individuals stopped playing with public entities,” he added. Whether Gordhan’s efforts to undo the damage done to SA’s economic reputation will be enough to save Number One’s skin remains to be seen.

While it will take years to reverse the damage caused by Zuma’s decision, his unprecedented backtracking is a positive step that should serve as a warning to those hell-bent on turning SA into their personal asset that the country belongs to all its people and not a powerful elite.

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