Fitch still unconvinced concerning outlook for South African economy

Gordhan who previously served as the minister from 2009 to 2014, was reappointed finance minister by President Jacob Zuma Sunday, Dec. 13, 2015 after firing Nhlanhla Nene and then David van Rooyen who was sworn in last week, succeeding Nene.

The abrupt announcement followed a weekend of intensifying calls, including from high-profile members of Zuma’s governing African National Congress and the party’s traditional allies, that Zuma reconsider his appointment of David van Rooyen as finance minister Thursday. As President Zuma indicated, when a decision triggers developments such as these, a democratic government has a duty to listen and respond appropriately.

Newly appointed minister of finance, Pravin Gordhan, speaks during a news conference in Pretoria, South Africa, Monday.

“Pravin Gordhan did a reasonable job in the sense of showing stability, but it was definitely the time in which some areas would have been better contained if there had been a better, much stronger hand at the helm”, says Booysen. And was Nene fired for not allowing it, or for something else?

Later, Zuma tried to bring about some calm by saying that Nene had been removed because he was in line for a top position at the new BRICS Bank.

President Jacob Zuma is under pressure to step down after he changed South Africa’s finance minister twice in five days, wiping billions off the stock market and raising fears of another ratings agency downgrade.

The political analyst further said the country will be heading into local government elections in 2016 and the ruling ANC needs money for campaigns which Nene would probably have been reluctant to release.

Mr Gordhan emphasised sound fiscal management and sober spending, particularly by state-owned enterprises such as South African Airways, the ailing national airline.

The South African rand dropped by about 5.7 percent against the dollar after the announcement holding at record low of about 15.5 to the USA currency.

Four days after appointing Van Rooyen, Zuma announced in another late-night statement that he was replacing the finance minister again. But critics said the damage to South Africa’s reputation, and to Zuma, would be lasting. “Nothing to save South Africa from junk status here, which is negative and a disappointment for the market”.

“The change has been made and that action has been taken to rectify what we believe really caused a bloodbath in the economy”, Duarte said.