148,000 jobs lost after Nene’s 2015 axing - Mogajane

Treasury director-general Dondo Mogajane says according to Treasury's analysts and investigators 148 000 jobs were lost, and there was a reduction of over R300 billion in the JSE’s markets capitalisation.

A video screengrab of National Treasury Director-General Dondo Mogajane at the state capture commission of inquiry on 23 November 2018.

JOHANNESBURG - Treasury director-general Dondo Mogajane has revealed to the state capture commission the true cost of former President Jacob Zuma’s axing of Nhlanhla Nene as finance minister in 2015.

Mogajane says according to Treasury's analysts and investigators 148,000 jobs were lost, and there was a reduction of over R300 billion in the Johannesburg Stock Exchange’s markets capitalisation.

Mogajane testified at the inquiry in Parktown on Friday.

Nene was fired and replaced by Des van Rooyen who only served in office for a few days.

The firing, which became known as “Nene-gate”, sent the rand into a tailspin forcing Zuma to reverse his decision to appoint Van Rooyen and replace him with Pravin Gordhan.

Mogajane says he instructed his team at National Treasury to assess the impact of "Nene-gate" and the consequences were dire.

“The catastrophic fall of the rand, about 148,000 jobs were lost in terms of the model that we ran. We saw a reduction of about R378 billion in the JSE’s market capitalisation and we also costed the impact to at least 1.1% of GDP by the end of that year.”

He says the impact of Nene’s axing is still being felt even now.

“I don’t think we were ever able to recover in the way that we had lost the market capitalisation of about R370 billion, the JSE has never recovered to that level, so the impact we’re still experiencing it today.”

He says business confidence was also at its lowest.

(Edited by Thapelo Lekabe)