• Gordhan says Zuma court ruling shows democracy's resilience
  • Relationship with tax chief Moyane is ``work in progress''

South Africa needs accountable leadership and greater political certainty to attract foreign investment and ward off a junk credit rating, Finance Minister Pravin Gordhan said, a day after the nation’s highest court ruled that President Jacob Zuma violated the constitution.

“We tend to shoot ourselves in the foot every now and again,” Gordhan told reporters Friday in the capital, Pretoria. “Where there is policy uncertainty, nobody is going to invest.”

Gordhan commented after the nation’s highest court ruled that President Jacob Zuma “failed to uphold, defend and respect the constitution” because he didn’t abide by graft ombudsman Thuli Madonsela’s 2014 findings that he should repay some of the 215.9 million rand ($14.5 million) of taxpayer money spent on renovating his private home. The court told the National Treasury to determine how much Zuma should repay, a process Gordhan said would be “transparent, thorough and professional.”

“We must wait to see how the court judgment ripples through our political economy,” Gordhan said. The ruling showed “we actually have a resilient democracy and that what we thought was a paper document called the constitution actually has force and effect,” he said.

Slowing Growth

Africa’s most industrialized economy is set to grow less than 1 percent this year, the slowest pace since a 2009 recession, according to the National Treasury and central bank. Standard & Poor’s has a negative outlook on its BBB- rating, one level above junk. Moody’s Investors Service rates South Africa’s debt one level higher.

Gordhan, 63, was reappointed to a post he held from 2009 to 2014 in December to steady markets that were roiled by Zuma’s decision to appoint a little-known lawmaker as finance minister in place of the respected Nhlanhla Nene. Since then, the president has refused to bow to Gordhan’s demand to fire tax chief Tom Moyane for defying his order to halt an overhaul of the national tax agency’s management and systems.

Gordhan, who was sitting next to Moyane, said their relationship remained a “work in progress.”

Moyane defended his decision to overhaul the tax agency, saying revenue would have fallen 12 billion rand short of target in the fiscal year that ended Thursday, had it not been undertaken. The agency collected 1.1 trillion rand ($75 billion) in the year, 200 million rand more than the revised tax-revenue estimate announced in the February budget.

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