S.A. Finance Minister discusses rumours and investor confidence

PUBLISHED: Wed, 14 Sep 2016 10:53:21 GMT

The top priority for besieged South African Minister of Finance Pravin Gordhan is to focus on building investor confidence in the country. While he is preparing for the mid-term budget, giving attention to loss-making South African Airways and fielding questions about his relationship with President Jacob Zuma, he is also dealing with allegations against him and an investigation by the HAWKS.

“The situation is that there is no legal clarity and the rumours of arrest are mischievous to say the least. They’re designed by some individuals for political objectives that I don’t understand,” Gordhan told Forbes Africa’s managing editor Chris Bishop during an interview for CNBC Africa. “Legal engagements with these entities will continue between lawyers on both sides and hopefully we can clear the matter sooner rather than later. As far as I am concerned, there is no substance to it, either in a legal sense or any other sense.”

These speculations about his position as an individual should not dent the confidence of foreign investors or the certainty they have in the country, he explained, as South Africa had built resilient institutions over the past two decades.

“At the end of the day all of us come and go, it’s what institutional capabilities you leave behind, it’s the sustainability of these institutions, the professionalism, the values, the culture that you instil in them and I think the world will recognise that,” he said.

Earlier this year the finance minister promised to get the budget deficit to 2.9 per cent by the end of 2017, but growth was lower than he expected.

“It’s tough because growth is lower than that we predicted at 0.9 per cent in February, that will have an impact in revenue situation so in six weeks we will give you the numbers as we understand them going into the future but it’s going to be a tough call,” Gordhan said.

What is needed most for the country’s loss making airline South African Airways, is a competent management team, and for the airline to rebuild confidence amongst its staff and customers.

“All of that is possible … if everyone is mature about what we have in front of us and understand their obligations both to the airline and to the country,” he said.

A few weeks ago the President and Minister attended the G20 in China together sparking rumours about their relationship.

Gordhon clarified it, saying: “The President is the head of state. I serve at his pleasure like any other minister does and we are obliged to ensure that we work in the interest of the country, which is what we do”.

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