South Africa's Van Rooyen Says `Colossal' Task Awaits Him

  • Finance minister to focus on improving investment conditions
  • Van Rooyen didn't mention fiscal deficit targets in speech

South Africa's New Finance Minister David Van Rooyen speaks during his swearing in ceremony at the Union Buildings in Pretoria, on Thursday, Dec. 10, 2015. Photographer: Waldo Swiegers/Bloomberg

South Africa’s new finance minister sought to allay investors’ fears on Thursday and said he was aware of the difficult task that awaits him.

“Mine is a colossal assignment, coming at a time when the global economic outlook is not favorable more especially for emerging markets,” David van Rooyen told reporters on Thursday in Pretoria, the capital, after he was sworn in. “I will undertake to ensure that every policy is directed at creating favorable investment conditions leading to the development of South Africa for all South Africans, not for the few.”

David Van Rooyen

Photographer: Waldo Swiegers/Bloomberg

President Jacob Zuma’s appointment of Van Rooyen late on Wednesday to replace Nhlanhla Nene came less than a week after credit-rating companies pushed the nation closer to junk status, citing concerns over a sluggish economy and rising debt. While Nene pushed forward plans to narrow the budget shortfall because of weak economic growth and lower tax revenue, he pledged in October to stick to the government’s spending ceiling and keep government debt under 50 percent of gross domestic product.

Neither Van Rooyen nor Zuma took questions after the ceremony. Van Rooyen didn’t discuss sticking to fiscal targets during his speech.

The “National Treasury is the axis of our development agenda,” Van Rooyen said. “We’re going to strive to make sure we improve on the achievement of those who came before us.”

The rand fell by as much as 5.4 percent to an all-time low of 15.3857 per dollar after Zuma’s announcement. It traded 1.9 percent weaker at 15.2681 at 2:58 p.m. in Johannesburg on Thursday. Yields on rand-denominated debt due December 2026 jumped 123 basis points to 10.05 percent. The yield rose above 10 percent for the first time since 2008.

Van Rooyen, who was a little known lawmaker for the ruling African National Congress until Wednesday, said he will probably meet with Treasury’s officials on Friday. He will seek to make the Treasury “more accessible,” he said.

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