King Henry II was widely blamed for the death of his Archbishop of Canterbury, Thomas Becket, who was murdered by some knights keen to curry the king’s favour. A similar, though less violent, thought may have been passing through the mind of South African president, Jacob Zuma, when he fired his finance minister recently.
The finance minister, Nhlanhla Nene, had won plaudits from economic analysts for his integrity and prudence in handling the nation’s finances during his 18 month tenure. He had been critical of wage increases for civil servants in the current economic climate, and was hostile to the idea of buying the president a new jet or bailing out South African Airways, the national carrier, amongst other things. He was opposed to plans to build new nuclear plants and other spending plans beloved of the president. He was regarded as a safe pair of hands in economic circles, no bad thing in these turbulent times.
His ouster has been met with bemusement and has been blamed on his lack of political clout in standing up to Zuma. He has been replaced by David van Rooyen, who, commentators believe, may be more sympathetic to the president’s spending and economic ideas.
News of the change in staff line-up sent the Rand to a fresh low against the US Dollar of under 15 Rand to the Dollar. The stock market also closed down. In recent weeks, the nation’s credit ratings have fallen with Fitch rating South African bonds as just above junk status and Standard and Poor’s changing the credit rating from stable to negative, meaning a downgrade is likely. One quarter of the South African workforce is currently idle and the nation’s economic growth is very sluggish. Before the Global Financial Crisis, the South African economy was tipped to become an emerging Goliath as a member of the BRICS group, how times have changed.