20°C / 22°C
  • Mon
  • 21°C
  • 9°C
  • Tue
  • 21°C
  • 10°C
  • Wed
  • 20°C
  • 10°C
  • Thu
  • 19°C
  • 8°C
  • Fri
  • 18°C
  • 6°C
  • Mon
  • 19°C
  • 14°C
  • Tue
  • 15°C
  • 10°C
  • Wed
  • 14°C
  • 9°C
  • Thu
  • 15°C
  • 11°C
  • Fri
  • 18°C
  • 9°C
  • Mon
  • 23°C
  • 10°C
  • Tue
  • 24°C
  • 11°C
  • Wed
  • 23°C
  • 10°C
  • Thu
  • 22°C
  • 8°C
  • Fri
  • 20°C
  • 8°C
  • Mon
  • 22°C
  • 7°C
  • Tue
  • 22°C
  • 6°C
  • Wed
  • 23°C
  • 7°C
  • Thu
  • 22°C
  • 5°C
  • Fri
  • 20°C
  • 3°C
  • Mon
  • 25°C
  • 16°C
  • Tue
  • 23°C
  • 16°C
  • Wed
  • 19°C
  • 15°C
  • Thu
  • 21°C
  • 13°C
  • Fri
  • 20°C
  • 12°C
  • Mon
  • 21°C
  • 14°C
  • Tue
  • 16°C
  • 9°C
  • Wed
  • 14°C
  • 8°C
  • Thu
  • 15°C
  • 10°C
  • Fri
  • 18°C
  • 10°C
  • Mon
  • 17°C
  • 10°C
  • Tue
  • 13°C
  • 5°C
  • Wed
  • 15°C
  • 4°C
  • Thu
  • 15°C
  • 5°C
  • Fri
  • 19°C
  • 6°C
  • Mon
  • 18°C
  • 12°C
  • Tue
  • 14°C
  • 8°C
  • Wed
  • 14°C
  • 6°C
  • Thu
  • 14°C
  • 8°C
  • Fri
  • 18°C
  • 7°C
  • Mon
  • 24°C
  • 9°C
  • Tue
  • 25°C
  • 9°C
  • Wed
  • 25°C
  • 9°C
  • Thu
  • 24°C
  • 7°C
  • Fri
  • 22°C
  • 6°C
  • Mon
  • 23°C
  • 3°C
  • Tue
  • 22°C
  • 5°C
  • Wed
  • 23°C
  • 4°C
  • Thu
  • 15°C
  • 1°C
  • Fri
  • 18°C
  • 0°C
  • Mon
  • 27°C
  • 8°C
  • Tue
  • 32°C
  • 8°C
  • Wed
  • 19°C
  • 9°C
  • Thu
  • 29°C
  • 8°C
  • Fri
  • 20°C
  • 7°C
  • Mon
  • 19°C
  • 13°C
  • Tue
  • 15°C
  • 7°C
  • Wed
  • 12°C
  • 6°C
  • Thu
  • 14°C
  • 9°C
  • Fri
  • 17°C
  • 8°C

'Political undertones might send confusing statements to rating agencies'

Economist Dawie Roodt says the contradicting messages from government show a lack of leadership.

Mosebenzi Zwane, South African Minister of Mineral Resources, addresses the first day of the Mining Indaba 2016 Conference on 8 February 2016, at the Cape Town International Convention Centre in Cape Town. Picture:  AFP/RODGER BOSCH

JOHANNESBURG - Economists and political analysts agree that the contradicting statements from government are confusing and the country's leadership needs to speak as one.

On Friday night, the presidency said Minerals Resources Minister Mosebenzi Zwane did not have the powers to speak on behalf of cabinet and his recommendations into investigating the four major banks had not been endorsed.

Zwane released a statement this week, saying cabinet discussed an independent monitoring commissions report and resolved to recommend that a judicial inquiry be established to investigate the bank's decision to close the Gupta family's accounts.

However, on 702 yesterday, the minister's spokesperson admitted that the cabinet had not approved the inquiry, as stated.

Economist Dawie Roodt says the contradicting messages from government show a lack of leadership.

"There's so much political undertones and fighting and a lot of backstabbing going on."

At the same time, political analyst Sipho Seepe says Zwane will need the backing of cabinet which he does not have according to the presidency.

"Whenever cabinet takes a decision we ended up with cabinet statements to that effect, we do not have that. So until that's known I'll simply take this as simply statement from politicians."

The Economic Freedom Fighters says it will be writing to the banks to encourage them to take action against the Gupta family.

MARKETS UNCERTAINTY

Economists say ratings agencies are closely monitoring the ongoing feuds between government entities and that possible divisions may lead to market uncertainty.

Group chief economist Goolam Balim says while the presidency has distanced itself the markets will remain unnerved.

"The cornerstone of a financial system is trust and when that trust is compromised, this may sounds like somehow a form of an exaggeration, but the entire edifice of the economy can crumble."

Roodt says he thinks there is too much politicking.

"Nobody really knows what's going on. But what I'm very sure about is that the rating agencies are taking note of this and I think we need miracle to prevent a downgrade. All this is very confusing and very upsetting."

At the same time, economists have warned that the contradicting messages from government over the Gupta family and an Inter-Ministerial Commission's recommendations regarding their bank accounts may further frustrate the markets.

Ballim said, "South Africa has witnessed, over the last couple of weeks, conflicting voices emerging, not just from government but also from the party, clearly tensions, divisions and fights within the party is beginning to spill into government."

Roodt said rating agencies are watching and taking note.

"The confusion that is going in government. The contradictions that we're getting from government, the total lack of leadership that we get from government is really something that we all need to be extremely concerned about."