Calls for Zuma to resign after ministerial firings

Within a week, President of South Africa Jacob Zuma removed David van Rooyen as the finance minister and appointed Pravin Gordhan for the position of Finance Minister.

Mr Van Rooyen, a former Executive Mayor, will also be bringing to COGTA the finance and economic sector background gained in serving in the Finance Portfolio Committee and Economic Transformation Cluster as whip in National Assembly.

The rand recovered to 15.09 rand from 15.89 rand against the US dollar immediately after the news broke late Sunday night.

New South African Finance Minister Pravin Gordhan has said concerns of rating agencies and investors have been noted and the government “shall endeavour to protect the investment”.

Zuma assigned Gordhan, who has also served with distinction as the Commissioner of the South African Revenue Services before excelling as Minister of Finance, with several tasks to address the country’s failing economy.

“I have received many representations to reconsider my decision”, Zuma wrote late Sunday of his decision to return Gordhan to the treasury.

“There is nothing new on growth or policy, no recognition of the damage done”, Peter Attard Montalto, an economist with Nomura International Plc, said in an e-mailed note. As President Zuma indicated, when a decision triggers developments such as these, a democratic government has a duty to listen and respond appropriately.

The appointment of van Rooyen to one of the government’s most important positions was particularly reckless, they said, because South Africa was already reeling from the worldwide drop in the price of commodities and almost slipped into a recession recently.

On December 9, Zuma dismissed Nene and appointed David van Rooyen, a little known MP, to replace him. Angry South Africans signed online petitions demanding the party “recall” Mr Zuma, and began planning marches on the presidential offices. Gordhan’s reappointment signals a move by Zuma to strengthen Africa’s second largest economy.

Razia Khan, an analyst with Standard Chartered bank, said the week’s turmoil was “perhaps the first instance since 2007 that Zuma has come under severe pressure within the party”. His appointment sparked widespread outrage and a slump in the rand to a historic low of more than 16 to the USA dollar.

As usual South Africans had a lot to say about the ANC press conference.

The prospect of the Federal Reserve raising interest rates this week means investors are wary of putting money into emerging markets, including South Africa.