Zuma drops new finance minister after market backlash

Mr Zuma’s office said he had “received many representations” to reconsider his decision to appoint Mr van Rooyen.

The new finance minister will be sworn in at 0800 GMT on Monday, with a press conference expected two hours later.

Mr van Rooyen will take over from Mr Gordhan as minister of co-operative governance and traditional affairs. He replaced a little-known lawmaker, David van Rooyen, who had held the post only since Thursday.

Maimane says reports indicate that Nene was removed as Finance Minister because of his standing firm on the SAA Airbus deal and his attempts to delay the nuclear build procurement deal.

Mohammed Nalla, head of research at Nedbank Capital, said having a finance minister serve just a few days did not bode well. But he had hardly sat down in the hot seat when he was replaced by Mr Nene’s predecessor, Pravin Gordhan. “Minister Gordhan will return to a portfolio that he had held proficiently during the fourth administration”. The rapid succession of finance minister caused the South Africa’s currency to plummet.

Gordhan, who was finance minister from 2009 to 2014, is well known for his fiscal discipline and has rich experience of handling finance issues, Mbongolwane told Xinhua.

Gordhan began with an observation: “I see we have created a bit of excitement for you”.

The markets cheered Gordhan’s appointment, the rand bounced back 5% against the dollar and stocks recovered.

“When a decision triggers developments such as we saw last week, a democratic government has a responsibility to respond”, he said.

The U-turn might have been prompted by a meeting between the chief executives of South Africa’s largest banks and the ANC leadership, which then briefed Mr Zuma.

Late last Wednesday, when Zuma fired finance minister Nhlanhla Nene after just 19 months in the position, the currency dropped to 15 rand to $1 dollar.

“This represents a very dark day for Zuma, who has clearly been shown the limits of his authority”, leading commentator Ray Hartley wrote in the Rand Daily Mail.

The prospect of the Federal Reserve raising interest rates this week means investors are wary of putting money into emerging markets, including South Africa. “Rating agencies will not re-rate us upwards”.

President Zuma would have made his calculations cleverly in terms of intelligence, but to the water-mouthed opposition political parties and economists, they would brand President Zuma a circus yet in reality he knows this intelligence game better than the so-called academics.

Zuma on Saturday denied rumors he had an affair with the chairwoman of state-owned airline South African Airways amid media speculation the relationship lay behind Nene’s sacking.

He also urged South Africans to “retain their optimism” as he would implement policies aimed at creating favourable investment conditions.

The political tumult unnerved many investors in South Africa, which is beset by high unemployment, slow growth and accusations of worsening government corruption. “Nobody’s going to touch the treasury for a long time”.

The days of economic turmoil may have passed for now, but infighting in the ruling party will likely continue until 2017, when a new party president is elected.