Zuma Said to Have Fired S. African Finance Minister Gordhan

  • Malusi Gigaba said to replace Gordhan as finance minister
  • Presidency says Zuma will make an announcement later

South Africa's Zuma Fires Finance Minister Gordhan

South African President Jacob Zuma fired Finance Minister Pravin Gordhan and replaced him with Home Affairs Minister Malusi Gigaba, two people familiar with the decision said, declining to be identified because it hasn’t been made public. The rand weakened.

Zuma will make an announcement relating to changes to the National Executive later, the Presidency said in emailed statement. He told senior ruling party leaders earlier this week of his plans and was opposed by three of the top six officals. Deputy Finance Minister Mcebisi Jonas was replaced by lawmaker Sfiso Buthelezi, according to the people.

Pravin Gordhan

Photographer: Waldo Swiegers/Bloomberg

The dismissal late Thursday came after a meeting of the top six members of the ruling African National Congress at Zuma’s private residence in Pretoria, the capital. It capped a dramatic week when Zuma ordered Gordhan on March 27 to cancel a series of meetings with investors in the U.K. and the U.S. and return home. The president told the senior ANC members this week that intelligence reports suggested Gordhan was trying to undermine his authority.

His ouster marked the end of a stormy relationship that began almost as soon as Zuma named Gordhan, 67, as finance minister in December 2015, four days after he triggered a sell-off in the rand by giving the post to a little-known lawmaker. Gordhan’s efforts to keep spending in check and protect South Africa’s investment-grade credit rating endeared him to investors. Yet he clashed with his boss over the affordability of building nuclear power plants and the management of state-owned companies. 

Credibility Gap

“The extent of the cabinet reshuffle, and the dramatic manner in which it was handled, is devastating,” said Anne Fruhauf, vice president at New York-based risk adviser Teneo Intelligence. “Gigaba and Buthelezi are both in the Zuma camp and the circumstances under which they have been appointed to the Treasury will cast a long shadow over their credibility.”

The rand extended its decline, falling to the weakest level against the dollar since March 10. The currency weakened 2.8 percent to 13.4129 per dollar by 11:46 p.m. in Johannesburg.

Gordhan’s successor, Malusi Gigaba, 45, was appointed as minister of home affairs in May 2014. A former president of the ruling party’s youth wing, Gigaba trained as a teacher and holds a masters degree in social policy. He previously served as the minister of public enterprises, deputy home affairs minister and as a lawmaker for the ANC.

Zuma is due to step down as ANC leader in December and as president in 2019. With the party continuing to dominate South African politics 23 years after it came to power in the nation’s first multiracial elections, the party’s next leader will probably also become South Africa’s next president.

Nkosazana Dlamini-Zuma, the former chairwoman of the African Union Commission, and Deputy President Cyril Ramaphosa are seen as the frontrunners for the post. Zuma’s comments that the ANC is ready for a woman leader have been widely seen as an endorsement for his ex-wife.

— With assistance by Michael Cohen

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