Still no explanation from Presidency for Gordhan call back
ANC secretary general Gwede Mantashe refused to say if the party's top six officials had been consulted about a possible Cabinet reshuffle.
CAPE TOWN/JOHANNESBURG – With Finance Minister Pravin Gordhan expected to touch down from London on Tuesday morning, there is still no explanation from the Presidency as to why President Jacob Zuma ordered him home.
On Monday, the Presidency said it ordered Gordhan and his deputy Mcebisi Jonas to cancel an international investor roadshow.
This led to speculation that Zuma was preparing to move against Gordhan.
African National Congress (ANC) secretary general Gwede Mantashe refused to say if the party's top six officials had been consulted about a possible Cabinet reshuffle.
Mantashe says the ANC national executive committee did not discuss Zuma's instruction to Gordhan.
The rand has lost around forty cents to the dollar since the news broke on Monday.
When asked about the plummeting of the rand following reports of the instruction, Mantashe said: “The real impact will be seen when there are any other steps.”
But experts have raised concerns following the rand’s dip.
Chief economist at Investment Solutions Lesiba Mothata warned that lessons have been learnt before.
“We have seen what happened when the minister was removed before and the ramifications were quite dire.”
Mothata says the announcement damaged the rand.
“This has come off as a surprise and has raised questions about whether the minister will be reshuffled.”
ETM Analytics’ George Glynnos says the announcement has come at a bad time.
“This is poor timing and it was again ill-informed to do this while the minister and his deputy were in the midst of a roadshow.”
Glynnos adds this is a blow for economic recovery.
“The rand was strengthening and South Africa was on a better wicket.”
Meanwhile, Nedbank economist Isaac Matshego says the president could make an announcement soon.
“This just says to us that there is something significant that will be announced by the president.”
The president removed Nhlanhla Nene as finance minister in 2015 and replaced him with Des van Rooyen.
The decision sent the markets into a tailspin.
The business sector and senior ANC leaders pressured the president into replacing Van Rooyen with Gordhan.
Last year the president defended his decision to remove Nene and said he was under attack from what he called monopoly, along with its friends and stooges.
(Edited by Shimoney Regter)