• All Share : 53905.21
    DOWN -1.04%
    Top40 - (Tradeable) : 47974.09
    DOWN -0.98%
    Financial 15 : 15138.03
    DOWN -1.41%
    Industrial 25 : 73978.09
    DOWN -0.48%
    Resource 10 : 31349.65
    DOWN -2.58%

  • ZAR/USD : 15.6841
    DOWN -0.83%
    ZAR/GBP : 22.7107
    DOWN -1.66%
    ZAR/EUR : 17.4593
    DOWN -0.83%
    ZAR/JPY : 0.1411
    DOWN -0.49%
    ZAR/AUD : 11.325
    DOWN -0.23%

  • Gold US$/oz : 1215.1
    UP 0.85%
    Platinum US$/oz : 981
    UP 1.55%
    Silver US$/oz : 15.95
    DOWN -0.13%
    Palladium US$/oz : 544
    UP 0.74%
    Brent Crude : 49.93
    UP 0.34%

  • All data is delayed by 15 min. Data supplied by Profile Data
    Hover cursor over this ticker to pause.

Tue May 31 20:03:45 SAST 2016

Nene axing slays rand

Jan-Jan Joubert, Reuters, Bloomberg and AFP | 10 December, 2015 00:57
David 'Des' van Rooyen
Image by: Supplied

President Jacob Zuma has fired Finance Minister Nhlanhla Nene only 18 months into his job, triggering a slump in the rand to a record low.

Nene will be replaced by ANC backbencher David ''Des'' van Rooyen, who is not held in the same esteem as his predecessor.

A former mayor of Merafong in Carletonville on the West Rand, Van Rooyen is not known for being anything but subservient to the party's leadership.

While regarded as competent on some matters of finance, he has been an unobtrusive member of parliament's finance committee.

Mbhazima Shilowa, a former Gauteng premier who later defected to the ANC breakaway party COPE, tweeted last night: ''I know the guy who's the new Finance Minister. He was a Mayor when I was Premier. He was a disaster hence [his] removal 2 years ahead of 2011.''

Nene's unceremonious firing, announced by Zuma in a terse statement last night, was not unexpected and comes a few months after the finance minister and his deputy, Mcebisi Jonas, tried to hold the line of fiscal discipline against rampant state spending and a widening budget deficit.

The last straw in a long line of battles seems to have been a strongly worded letter Nene wrote to South African Airways's controversial chairman, Dudu Myeni, a close confidante of the president, in which he tried to rein her in over a multibillion-rand leasing deal with Airbus.

Zuma gave no details as to why Nene was dismissed.

"I have decided to remove Mr Nhlanhla Nene as Minister of Finance, ahead of his deployment to another strategic position," the president said.

The rand fell sharply, to R15.24 to the dollar, shortly after the announcement, extending a series of losses this year. The currency was down 2.4% at 14.94 per dollar at 10.40pm.

DA leader Mmusi Maimane said Nene had tried in vain to stand in the way of the Zuma administration's reckless spending to grow the economy and save jobs, and was now paying the price.

Nene's attempts to turn around the loss-making SAA have, in recent weeks, been undermined by the national carrier's board, which sought to ignore his instructions over the Airbus deal and implement an alternative proposal the Treasury said was unduly risky.

Nene was also a vocal opponent of the costs associated with the government's controversial proposed nuclear procurement which industry experts fear could cost the country R1-trillion.

Since his appointment in mid-2014 Nene has emphasised the need to cap government spending, rein in bailouts to state-owned firms, and limit the size of wage increases to state employees.

He also tried to curb spending by public servants and cabinet members on parties, travel and other excesses.

Nene's ministerial fortunes follow those of his predecessor, Pravin Gordhan, who was also shifted from the finance portfolio after he tried to get senior civil servants to curb their spending.

Nene's dismissal comes on the heels of a credit rating downgrade to just one notch above sub-investment grade, or junk, by Fitch last Friday. Standard and Poor's also cut the outlook on its equivalent rating to negative.

The economy narrowly avoided slipping into a technical recession in the third quarter, growing by a meagre 0.7% after contracting in the second quarter.

Additional reporting by ©BDLive


If you have an opinion you would like to share on this article, please send us an e-mail to the Times LIVE iLIVE team. In the mean time, click here to view the Times LIVE iLIVE section.