Zuma said to have told SACP he will fire Gordhan

President Jacob Zuma told senior leaders of the South African Communist Party that he plans to fire Finance Minister Pravin Gordhan, according to three people with knowledge of the matter. The rand plummeted.

Zuma told officials from the party, which is allied to his ruling African National Congress, during a meeting on Monday in Johannesburg, according to the sources, who were present and asked not to be identified because a public statement has not been made. He didn’t say when he planned to fire Gordhan.

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Zuma, 74, ordered Gordhan to cancel meetings with investors in the U.K. and the US and return home on Monday, a day after he had flown to London to begin the week-long roadshow.

A later meeting of the top six leaders of the ANC was to be held after the SACP gathering and there was no indication that they agreed with the decision to fire Gordhan. Zizi Kodwa, a spokesman for the ANC, said the people were misinformed.

The rand weakened as much as 2.9% and was at 12.9869 to the dollar by 9:32 a.m. in Johannesburg.

Speculation that Gordhan is on the verge of being fired has swirled for months, as he clashed with Zuma over the management of state companies and the national tax agency.

While Gordhan has led efforts to keep spending in check and fend off a junk credit rating, Zuma wants to embark on “radical economic transformation” that he says will tackle racial inequality and widespread poverty.

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“I don’t know if it’s true that Gordhan will be fired,” Enoch Godongwana, the ANC’s head of economic policy, said by phone. “If that were to happen, it would be tragic for the economy. We are trying to move our growth to better levels. The growth numbers are beginning to reflect a positive trend. This sort of issue will be damaging.”

Zuma said during the meeting with the Communist Party he had taken the decision to remove the finance minister because he was the president with responsibility for leading the government and Gordhan was blocking him, according to the sources.

“The Treasury and the finance minister are doing a credible job,” Cas Coovadia, managing director of the Banking Association of South Africa, said by phone. “It would be extremely unfortunate if the capacity in the Treasury and the legitimacy it has is diluted in any way.”

Gordhan’s dismissal may be delayed because ANC officials will be preoccupied with ceremonies to honor Ahmed Kathrada, the anti-apartheid activist jailed with former President Nelson Mandela, who died Tuesday at the age of 87.