South Africa&#8217;s anti-graft watchdog has told President Jacob Zuma that its report into possible undue political influence of his friends is final, dimming his hopes of adding to its findings as he battles pressure from within his own ANC party to resign.
Zuma filed an affidavit in court on Tuesday asking whether the report was final and if he would be able to question witnesses himself and respond to accusations he allowed an Indian-born business family to interfere in state affairs.
The Gupta brothers, Ajay, Atul and Rajesh, are subject of a report on allegations that they swayed appointments of ministers and use political connections to win tenders.
Zuma, facing calls to quit from opposition parties and even within the ruling African National Congress due to his links with the Gupta family, denies any impropriety, as do the three businessmen.
The Public Protector said the report had already been completed by Thuli Madonsela, whose seven-year term as head of the constitutionally-mandated watchdog ended this month. She has been succeeded by Busisiwe Mkhwebane.
&#8220;The Public Protector has the president’s latest affidavit and has through the attorneys confirmed that the report was finalised and signed by Adv. Madonsela on 14 October 2016,&#8221; Mkhwebane&#8217;s spokeswoman told Reuters.
Zuma had successfully delayed the report&#8217;s planned Oct. 14 release by asking a court to first hear arguments that he had not had the chance to review any evidence that implicated him. The hearing is due on Nov. 1.
Madonsela, who was a thorn in Zuma&#8217;s side, had previously said the report was final and that the president had been given an opportunity to respond to allegations, including during a four-hour interview earlier this month.
The dispute over the report comes at a time when Zuma&#8217;s government is reeling after Finance Minister Pravin Gordhan was ordered to appear in court on Nov. 2 to hear fraud charges against him. Gordhan has dismissed the charges as &#8220;frivolous&#8221;.
The opposition and analysts say Gordhan&#8217;s woes are a witch-hunt by a faction allied to the president, recalling that the finance minister has vowed to fight patronage in government.
Zuma has denied there is any plot to oust Gordhan.
The Business Day newspaper on Wednesday cited an internal party report in which some branches of the ANC are calling for Zuma and the main party&#8217;s leadership to step down after a poor showing at local elections in August.
ANC spokesman Zizi Kodwa declined to be drawn on the report, saying &#8220;we don&#8217;t comment on internal discussions.&#8221;
 
(Writing by Joe Brock and James Macharia; editing by Mark Heinrich)﻿
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S.A's Public Protector says report blocked by Zuma is final

South Africa&#8217;s President Jacob Zuma has filed court papers to determine if an unreleased report into allegations of political interference by wealthy brothers Ajay, Atul and Rajesh Gupta is final, eNCA TV said on Wednesday.
In the affidavit filed on Tuesday and published on the channel&#8217;s website, Zuma also admitted he was &#8220;an implicated person&#8221; in the report by the former Public Protector, a constitutionally mandated anti-graft watchdog.
Zuma has denied granting undue influence to the Guptas and they have denied seeking it.﻿

South Africa's Zuma admits he is "implicated" in graft report

South Africa&#8217;s economy still faces major challenges despite growing by 3.3 percent in the second quarter after contracting in the first, President Jacob Zuma said on Tuesday.
In an address to South African diplomats who represent the country abroad, Zuma also said he backed efforts by Finance Minister Pravin Gordhan to reassure investors about betting on Africa&#8217;s most industrialised country.
Investors have been nervous about Pretoria&#8217;s commitment to sound economic policy since Zuma changed finance ministers twice in less than a week in December. Fraud charges by the state against Gordhan announced last week have also hurt markets.﻿

Pres. Zuma says South Africa's economy faces major challenges

South Africa&#8217;s Constitutional Court has told the state prosecutor it cannot appeal a ruling to reinstate corruption charges against President Jacob Zuma, another setback for the embattled leader.
The High Court in April ordered a review of a National Prosecuting Authority (NPA) decision to set aside hundreds of corruption charges against Zuma, calling it &#8220;irrational&#8221;. That decision allowed Zuma to run for president in 2009. 
The High Court has already refused the NPA&#8217;s attempt to appeal that ruling. After that, the NPA approached the Constitutional Court while Zuma went to the Supreme Court of Appeal (SCA), which is yet to rule on the matter. 
&#8220;The Constitutional Court has considered this application for leave to appeal. It has concluded that it is not in the interest of justice for this court to hear the matter at this stage,&#8221; the court said in an order dated Sept. 28.
&#8220;The application for leave to appeal is dismissed.&#8221;
NPA spokesman Luvuyo Mfaku said the court was mindful of the fact that Zuma had petitioned the SCA on the same matter.
&#8220;The matter at the SCA is still pending, so with that in mind they cannot adjudicate on a matter that can come back to them,&#8221; Mfaku said.
The opposition Democratic Alliance (DA) said the appeals were attempts by the NPA and Zuma to delay him having his day in court.
&#8220;The DA has argued that there are no reasonable prospects of success nor are there any other compelling reasons why the appeal should be heard,&#8221; it said in a statement.
The scandals swirling around Zuma contributed to the worst election showing by the ruling African National Congress (ANC) in local polls in August, intensifying calls for his resignation.
The prospect of Zuma&#8217;s corruption charges being reinstated follows a damning constitutional court judgment against him in March. The court said he breached the constitution by refusing to refund some of the 240 million rand ($17 million) of state money spent on refurbishing his private residence.
Zuma has since repaid some of the money. [nL8N1BO2EF]
($1 = 13.8635 rand)﻿

South Africa's top court denies prosecutor appeal on Zuma graft charges

South African President Jacob Zuma on Thursday appointed Busisiwe Mkhwebane as the new Public Protector, a constitutionally mandated anti-corruption watchdog.
Mkhwebane, a lawyer whose most recently held a position at the State Security Agency, replaced Thuli Madonsela, a popular figure with the public who led an investigation into improper state spending on Zuma&#8217;s country home.﻿

South Africa's Pres. Zuma appoints new Public Protector

South Africa&#8217;s President Jacob Zuma has instructed his justice and crime prevention ministries to deal with the violence during student protests over tuition fees at universities, a cabinet spokesman said on Thursday.
At least six universities&#8217; classes have been disrupted and some suspended as police and private security companies have tried to quell student dissatisfaction at a fee increase announced by government earlier this month.
&#8220;President Jacob Zuma has instructed the justice crime prevention and security cluster to deal with the mayhem that is destroying our institutions of higher learning,&#8221; Minister in the Presidency Jeff Radebe told a post-cabinet media briefing.
In a separate statement Zuma&#8217;s office rejected rumours on social media that the nation&#8217;s cabinet has been reshuffled.

South Africa's Zuma asks for university 'mayhem' to be dealt with

South Africa&#8217;s deputy President Cyril Ramaphosa saw his chances of becoming the country&#8217;s next leader increase on Monday when the powerful mining union he helped found before he made a fortune in business backed him to succeed President Jacob Zuma.
The debate over who should follow Zuma, either when his term ends in 2019 or before, has heated up since the ruling African National Congress (ANC) suffered its worst local election results last month, exposing party divisions.
No one has declared an ambition to take over but informal positioning is well under way, with the party split between backers of Ramaphosa, a former anti-apartheid leader popular with investors, and those who feel he would be too pro-business.
A decision has been taken &#8220;to support the candidacy of Cyril Ramaphosa for president&#8221; (of the ANC), the National Union of Mineworkers (NUM), one of South Africa&#8217;s biggest unions, said.
With just under 200,000 members, the NUM plays an important role in galvanising public support for the ANC at elections and its endorsement could encourage other unions to follow suit.
But Ramaphosa&#8217;s position as a director on the board of platinum producer Lonmin when South African police shot dead 34 wildcat strikers in 2012 undermines his popularity.
An articulate though often wooden speaker, he is likely to face strong competition if he does compete, including from Zuma&#8217;s ex-wife, Nkosazana Dlamini-Zuma, head of the African Union.
Zuma is expected to stand down as ANC president at a party conference late next year, ahead of national elections in 2019 when his tenure as the country&#8217;s president will end. He has faced calls to quit early from several members of the ANC and prominent business leaders following a string of graft scandals.
The ANC&#8217;s dominance of South Africa since apartheid ended in 1994 means it is widely expected to win the 2019 election, making its next leader almost certain to become president.
In ANC tradition, the deputy usually ascends to the top post, but some in the party and its allied trade unions think Ramaphosa would take the party too far from its left-wing roots.
 
UNDECIDED
A lawyer by training, Ramaphosa, 63, was a founding member of the NUM, forged in the crucible of the struggle against apartheid in the 1980s.
He went on to become the ANC&#8217;s chief negotiator in talks that led to the end of white rule and Nelson Mandela&#8217;s election as South Africa&#8217;s first black president in 1994. His business interests have ranged from mining to McDonald&#8217;s outlets.
NUM&#8217;s current General Secretary David Sipunzi said: &#8220;It is not only NUM that is gunning for Cyril for president, &#8220;without giving details. He said, however, that NUM wanted Zuma to see out his second term as the country&#8217;s leader.
Frans Baleni, a former head of NUM who worked with Ramaphosa in the 1980s, described Ramaphosa as a good listener with a sharp attention to detail who did not tolerate shoddy work.
&#8220;He has a high level of empathy,&#8221; he said.
The ANC rules in an alliance with the South African Communist Party and trade union group, COSATU, both of which will be influential in lobbying for Zuma&#8217;s successor.
The NUM is one of a string of unions in COSATU, which played a key role in opposing white-minority rule and says it represents 2 million workers. It has yet to publicly back any candidate.
&#8220;COSATU has not come up with an official position. We must speak to all the unions and come with a clear mandate,&#8221; Matthew Parks, COSATU&#8217;s Parliamentary Coordinator, told Reuters.
 
PROSPECTS
Gary van Staden, a political analyst at NKC African Economics, said the NUM endorsement would bolster Ramaphosa&#8217;s position. &#8220;Other COSATU members should line up soon behind Cyril. His prospects are good.&#8221;
But while Ramaphosa comes from the minority Venda tribe, Dlamini-Zuma, 67, is a Zulu, the largest ethnic group in South Africa, and would likely have the support of Zuma&#8217;s powerful voting block within the ANC were she to run.
Around one in five South Africans are Zulu and politicians from Zuma&#8217;s home Kwa-Zulu Natal province, a key ANC stronghold, have influence over top party decisions.
Despite their separation, Zuma backed her for the AU job and gave her a position in his cabinet. Analysts say she would be unlikely to follow up on several high-profile corruption cases that have plagued his tenure.
Zweli Mkhize, a Zulu and the current ANC Treasurer-General, has also been mentioned as a potential party leader.
($1 = 13.6435 rand)﻿

South African union backs unionist-turned-tycoon Ramaphosa as next president

Political infighting, weak economic growth and mounting debt at state-owned companies all pose a risk to South Africa&#8217;s credit rating, Moody&#8217;s said on Thursday.
Moody&#8217;s, which rates Africa&#8217;s most industrialised economy two notches above sub-investment grade, said its negative outlook reflected &#8220;wide and rising political divisions that generate policy uncertainty and impede structural reforms&#8221;.
President Jacob Zuma and Finance Minister Pravin Gordhan are locked in a power struggle over spending at state-owned companies and plans for a multi-billion dollar nuclear power programme, political and financial analysts say.
Zuma denied this week that there was a &#8220;war&#8221; between the Presidency and Treasury.
&#8220;Policy paralysis and infighting is another risk, which is
becoming evident with, for example, increased uncertainty about continuity of leadership at the National Treasury,&#8221; Moody&#8217;s said in its quarterly credit opinion.
Moody&#8217;s affirmed its Baa2 rating on South Africa in May. Fitch and S&amp;P Global Ratings have South Africa one step above subinvestment, or &#8220;junk&#8221;, with negative outlooks. All three are expected to make their next ratings decisions in December. [L5N184033]
Moody&#8217;s on Wednesday said it may cut the ratings of five South African state-owned firms over funding risks.﻿

South Africa's political infighting adding to downgrade risk: Moody's

Members of South Africa&#8217;s ANC chanted slogans outside its headquarters on Monday demanding President Jacob Zuma step down in a rare public show of anger in the ruling party after its worst election performance since the end of apartheid in 1994.
The demonstrators argue that Zuma, whose rule has been tainted by scandal, is responsible for the African National Congress (ANC) losing control of three major urban centres in local elections last month by mismanagement of the economy that is now teetering on the edge of recession.
Though the protesters numbered fewer than 100, the demonstration kept political tension high in Africa&#8217;s most industrialised country, where markets have been rocked by a police investigation into Finance Minister Pravin Gordhan.
Political analysts say Gordhan is the target of an ANC faction allied to Zuma. The president&#8217;s office has denied claims Zuma was warring with Gordhan.
Camouflage-clad veterans of the ANC&#8217;s now-disbanded Umkhonto we Sizwe (MK) military wing, its Youth League and police with armoured vehicles ringed the party&#8217;s Luthuli House building in downtown Johannesburg, causing a stand-off with the protesters.
Some of the protesters carried placards, with one emblazoned: &#8220;Resign with immediate effect: ANC NEC and Jacob Zuma&#8221;, referring to the party&#8217;s National Executive Committee of Zuma and five other party leaders.
A placard by rival Zuma supporters read: &#8220;Don&#8217;t try this at Luthuli House&#8221;.
Critics of Zuma say he is also badly compromised by his relationship with the Guptas, a family of wealthy Indian businessmen with interests ranging from media and meining, who the opposition says exerts undue political influence over the president.
Outnumbered on the streets, the protesters gave a list of their grievances to Secretary-General Gwede Mantashe.
&#8220;There was a big hullabaloo in the media that there was going to be a big movement to occupy Luthuli House. There is not such a movement. It&#8217;s a grouping &#8211; small,&#8221; Mantashe said.
Although the ANC won the most votes overall in the Aug. 3 local polls, its reputation was badly bruised by its loss of support mainly in major cities.
Analysts said more internal squabbles were likely following the election losses, but would only bring change if they were led by senior party figures.
&#8220;An effective way would be to have big heavyweights in the ANC who say that we want the leadership to step down and we are organising a march,&#8221; said Prince Mashele, head of the Centre for Politics and Research, a Pretoria-based think-tank.﻿

S.Africa's president Zuma urged by protesters to quit

South Africa&#8217;s government has reappointed Dudu Myeni as the chairwoman of South African Airways, the loss-making state-owned airline, it said on Friday.
The cabinet said Myeni, an ally of President Jacob Zuma, was appointed alongside 11 other board members to the board of SAA. The new team will meet the Minister of Finance Pravin Gordhan who will provide direction from a shareholder perspective, it said in a statement.
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On Thursday a Finance Ministry source said officials in the department had opposed Myeni&#8217;s selection, but had managed to push through some preferred candidates to the cash-strapped airline&#8217;s new board.
SAA has been surviving on state-guaranteed loans and has failed to submit financial statements for the past two years, with results for 2015/16 held back after the Treasury refused to grant it 5 billion rand ($343 million) in additional loan guarantees.
Myeni&#8217;s reappointment comes two days after asset manager Futuregrowth said it had halted lending to state-owned firms over concerns of political interference in their administration.
In December Zuma denied rumours that he had had an affair with Myeni or that their ties had led to the sacking of then-finance minister Nhlanhla Nene, who had rebuked Myeni for mismanaging a 1 billion-rand deal with Airbus.
Critics say government plans to form a new committee to be supervised by Zuma that would oversee state-owned enterprises like SAA will limit Gordhan&#8217;s control over firms.
The rand has slid more than 8 percent against the dollar since Aug. 23, also on renewed fears that Gordhan could be charged over the activities of a surveillance unit set up when he was head of the tax department which police say illegally spied on politicians.
($1 = 14.5933 rand)﻿

South Africa's government reappoints Dudu Myeni as chairwoman of national airline

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JOHANNESBURG, Sept 2 (Reuters) &#8211; South Africa&#8217;s presidency said on Friday that a minister not a cabinet team had asked for a judicial inquiry into why banks cut ties with a company belonging to the Gupta family, conflicting messages from a government which appears increasingly divided.
On Thursday, Mineral Resources Minister Mosebenzi Zwane had said the inter-ministerial team, set up by the cabinet in April and led by him, had cabinet backing for its proposal to set up such an inquiry to consider legal action against the banks.
That could trigger further turmoil after markets were rocked by a police investigation of Finance Minister Pravin Gordhan.
South Africa&#8217;s Treasury is also in public rows with state-owned companies over their dealings with firms linked to the Guptas, who have been accused of holding undue sway over the President Jacob Zuma.
The statement from Zwane&#8217;s team said the banks that had closed Gupta-owned Oakbay Investments&#8217; accounts were influenced by &#8220;innuendo and potentially reckless media statements&#8221;.
The prominent business family is accused by the opposition of being behind Zuma&#8217;s abrupt sacking of former finance minister Nhlanhla Nene in December, a move that rattled investor confidence and triggered calls for Zuma&#8217;s resignation.
The Guptas have denied using their friendship with Zuma to influence his decisions, including on cabinet appointments, or to advance their business interests.
The president has acknowledged the Guptas are his friends but denies any improper behaviour based on that.
REGRET OVER CONFUSION
On Friday evening, presidency spokesman Bongani Ngqulunga said in a statement that the proposals by Zwane, which had drawn criticism from political commentators, were not the views of the inter-ministerial team, nor the cabinet.
Ngqulunga said the presidency regretted the confusion caused by Zwane&#8217;s statement, which &#8220;was issued in his personal capacity and not on behalf of the task team or Cabinet&#8221;.
As part of its recommendations, Zwane said his team also urged Zuma to set up a state bank and called for new banking licences to be issued to end the &#8220;oligopoly&#8221; in the industry.
He also said that although Gordhan was one of the cabinet team&#8217;s members, he did not take part in its meetings.
Asset manager Futuregrowth said earlier this week it had decided to stop lending money to six state-owned companies because of the swirling political uncertainty.
Gordhan said on Friday that Futuregrowth&#8217;s decision was a &#8220;very concerning development&#8221;.
Speaking to the SABC news broadcaster in China, where he has accompanied Zuma for a G20 meeting, Gordhan said &#8220;we in the Treasury have been warning both political figures and people who run some of our institutions to be careful &#8230; and make sure your governance is right&#8221;.
&#8220;Don&#8217;t think that the world is not watching us in some of the things that are happening in some of these SOEs (state-run enterprises). Those people are not obliged to lend us money.&#8221;
Gordhan is embroiled in a separate investigation into whether he used a tax service unit to spy on other politicians &#8211; something he denies &#8211; and that has also put markets on edge about the fate of Africa&#8217;s most industrialised economy.
Several banks and companies had cut ties with Oakbay, including South Africa&#8217;s top four: Standard Bank, Nedbank, Barclays Africa&#8217;s Absa and First National Bank (FNB), part of FirstRand.
In April, Oakbay approached government departments including the presidency to express &#8220;deep disappointment&#8221; over the account closures, saying this made it &#8220;virtually impossible&#8221; to do business in South Africa.
A family spokesman for the Indian-born businessmen, who moved to South Africa in the early 1990s, said any inquiry would not change plans announced on Saturday for the Guptas to exit their South African businesses this year.
Although the Guptas&#8217; relationship with Zuma has been a source of controversy for years, it burst into the open in March when senior political figures went public to say the family had exerted undue sway, including offering cabinet positions. (Additional reporting by Ed Stoddard; Editing by Louise Ireland)
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South Africa says minister, not cabinet, asked for bank inquiry

South Africa&#8217;s ruling party backed Finance Minister Pravin Gordhan on Tuesday but said ministers should obey police summons issued during investigations, days after Gordhan declined to meet detectives looking into his time at the tax office.
Gordhan said last week he had done nothing wrong and had no legal obligation to obey a police summons over the probe into whether he used a surveillance unit set up when he was head of the tax service to spy on politicians.
There has been speculation in local media that Gordhan could be charged over the investigation, but state prosecutors have denied the claims, which have hit South African assets.
&#8220;The continued speculation and the public spectacle &#8230; is hurting the economy and could be dealt with better,&#8221; African National Congress (ANC) Secretary General Gwede Mantashe said. &#8220;The ANC reaffirms its unreserved confidence in the Minister.&#8221;
The rand gained briefly after Mantashe expressed confidence in Gordhan but then went into reverse, falling 0.6 percent to a session low, after he told a news conference that ministers must obey police summons.
&#8220;The minister must cooperate with processes. If he has no case to answer he can only prove that through processes,&#8221; Mantashe told a news conference.
He also said the Treasury, one of South Africa&#8217;s most respected government departments, should not seek to present itself as being above the law and deserving of special treatment.
&#8220;We do however caution them against taking a public posture that seems to isolate themselves from the rest of government and positions them as victims to be protected by society,&#8221; he said.
The investigation first came to light in February. Political analysts say it is part of a plot to undermine Gordhan by a faction allied to President Jacob Zuma, who is said to have been among the politicians spied on by the tax surveillance unit.
Zuma has denied warring with Gordhan.
 
(Reporting by Stella Mapenzauswa; Writing by James Macharia; Editing by Ed Cropley)﻿

South Africa's ruling party backs finance minister Gordhan

South Africa&#8217;s Treasury and state-owned Eskom clashed on Monday over a probe into coal contracts between the power utility and a company linked to the wealthy Gupta family that is accused of holding undue political sway over President Jacob Zuma.
The row further scarred relations in a government rocked by a police investigation of Finance Minister Pravin Gordhan over a suspected surveillance unit set up when he ran the tax service. The turmoil has weakened South African assets.
Analysts say Zuma&#8217;s team and the Treasury under Gordhan have disagreed about government spending at state companies and the tussle between Treasury and Eskom signalled a prolonged dispute.
In a statement, the Treasury accused executives at Eskom, including Chief Executive Officer Brian Molefe, of resisting attempts to investigate coal contracts between the utility and Tegeta, a company controlled by the Gupta family.
The Treasury said Eskom had blocked its probe since April.
&#8220;The National Treasury would like to categorically state that its efforts have met resistance,&#8221; it said in a statement.
Eskom denied preventing the investigation into its deals with Gupta-controlled Tegeta Exploration &amp; Resources Ltd. and said that it was &#8220;shocked and perplexed&#8221; by the statement issued by the Treasury.
The Gupta family, which is being investigated by the anti-corruption watchdog on suspicion of influencing government appointments, announced on Saturday that it planned to dispose of its South African businesses before the end of the year.
The Guptas, a family of Indian-born businessmen who moved to South Africa in the early 1990s, have denied trying to influence political appointments or using their ties to Zuma for advancing their business interests, saying they are the victims of a plot. Zuma has also denied any wrongdoing.
Eskom said in a statement over the weekend the Treasury had not issued any conclusive findings against it on any of the utility&#8217;s coal contracts‚ and that it was cooperating with the Treasury on its investigations of the contracts.
The Sunday Times reported that the Treasury&#8217;s investigation had revealed that Eskom paid more than 130 million rand ($9 million) to a mining company owned by the Gupta family for coal the power utility could not use.
The Treasury said on Monday it had sent a report to Eskom&#8217;s Chief Executive Officer Brian Molefe and board Chairman Ben Ngubane for their comment and requested a list of payments made to Tegeta, both of which the utility ignored.
The Treasury said Gordhan escalated the matter to Ngubane, raising concerns about advance payments made to Tegeta, but this also failed to bear fruit.
Eskom said it had received the Treasury&#8217;s lengthy report in April and had requested for additional time to issue its reply and would do so by the end of September after a board meeting.
FRUSTRATION
On Thursday, the presidency defended a new plan to give Zuma supervision over state-owned firms after Gordhan&#8217;s allies said this would limit the finance minister&#8217;s control.
Such firms include Eskom and the South African Airways, which has announced plans to raise 16 billion rand ($1 billion) for working capital and debt repayment.
A Zuma-backed plan to build a series of nuclear power plants, at a cost of as much as $60 billion, has caused tension with the Treasury for months. The presidency has said that Zuma was not warring with Gordhan.
Gordhan said on Wednesday he had done nothing wrong by setting up the surveillance unit at the tax service and declined to obey a police summons linked to the probe, setting the stage for a drawn-out confrontation between him and authorities.
&#8220;This is almost a public justification of Gordhan&#8217;s frustration over the running of state owned firms,&#8221; said Daniel Silke, a director at Political Futures Consultancy, referring to the statement issued by the Treasury on Eskom.
The ructions in government have weakened the rand and bonds in an economy teetering on recession, but the central bank said it will not respond to short term market volatility triggered by news of possible charges against Gordhan.
 
(Editing by Toby Chopra)﻿

S.African Treasury, Eskom row over coal contracts as government rifts deepen

South Africa&#8217;s presidency on Thursday defended plans to give President Jacob Zuma supervision over state-owned companies after allies of under-fire Finance Minister Pravin Gordhan said it was a tool to limit his control.
Cabinet announced on Monday that a new committee on state-owned enterprises (SOEs) would be set-up to &#8220;provide Zuma line of sight on strategic decisions and interventions&#8221; to improve the performance of SOEs.
Former finance minister, Trevor Manuel, said the new council was an attempt to limit the powers of Gordhan, who declined a request by an elite police unit this week to present himself in relation to allegations he used the tax office to spy on politicians, including Zuma.
&#8220;There has been intense speculation since the announcement this week, with some commentators and journalists suggesting some sinister motives behind the establishment of the Council,&#8221; the presidency said in a statement.
&#8220;Such speculation is baseless and false.&#8221;
Analysts have said that Zuma&#8217;s team and the Treasury under Gordhan have disagreed about government spending, including at loss-making state companies like South African Airways.
Gordhan has pledged to rein in government expenditure to limit rising inflation, narrow a gaping budget deficit and appease ratings agencies considering cutting South Africa to &#8220;junk&#8221; status in reviews expected by December.
 
(Reporting by Joe Brock; Editing by James Macharia)﻿
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South African presidency defends new team to oversee state-owned companies

South African President Jacob Zuma said on Thursday he has full confidence in Finance Minister Pravin Gordhan, who is under police investigation over a suspected spy unit at the tax service.
Zuma said he could not intervene in the investigations despite the negative impact the probe has caused on the economy, according to a statement released by the presidency.
The rand, which had tumbled 5 percent since Tuesday in response to the investigation, extended gains to 1.3 percent after Zuma&#8217;s statement after starting a recovery on Thursday.
News of Gordhan&#8217;s summons this week compounded investors&#8217; worries about a power struggle between Zuma and Gordhan as Africa&#8217;s most industrialised economy teeters near recession and credit rating agencies consider downgrading it to &#8220;junk&#8221; by year-end.
In his first public comments on the matter since it surfaced late on Tuesday, Zuma said he had noted the concerns by individuals and various organisations over the investigation.
&#8220;President Jacob Zuma wishes to express his full support and confidence in the Minister of Finance and emphasises the fact that the minister has not been found guilty of any wrong doing,&#8221; the presidency said in a statement.
&#8220;The Presidency wishes to also emphasise that President Zuma does not have powers to stop any investigations into any individual/s.&#8221;
&#8220;The negative effect of these matters on our economy, personal pressure on the individuals affected as well as the heads of institutions, however disturbing, cannot be cause for the President to intervene unconstitutionally.&#8221;
Gordhan said on Wednesday he had no legal obligation to obey a police summons linked to an investigation into whether he used the South African Revenue Service (SARS) to spy on politicians including Zuma.
 
(Reporting by James Macharia; Editing by Dominic Evans)﻿

Zuma says has confidence in S.Africa finance minister, can't intervene

By Joe Brock and Zimasa Mpemnyama﻿
South Africa&#8217;s biggest parties have failed to form coalition governments in major economic hubs following elections this month, they said on Wednesday, raising the prospect of less stable minority administrations.
Since the African National Congress (ANC) lost its majority in major municipalities this month, in its worst electoral performance since it came to power nationally at the end of apartheid, the main parties have been attempting to assemble coalitions.
The radical leftist Economic Freedom Fighters (EFF), the ANC and the main national opposition, the Democratic Alliance (DA), failed to agree on major policies, EFF leader Julius Malema told reporters.
Malema, a fiery former ANC youth leader, said the EFF would vote with the DA at council meetings in order to deprive President Jacob Zuma&#8217;s ANC of municipalities that it has controlled since the end of white-minority rule 22 years ago.
With EFF votes, the DA is now likely to form minority administrations in Johannesburg; the neighbouring industrial region of Ekurhuleni that hosts the main airport; and Tshwane, which includes the capital Pretoria, Malema said.
He also said the EFF would assist the DA in the symbolically important Nelson Mandela Bay, which includes the manufacturing hub Port Elizabeth, although the DA said it could rule there without EFF help.
Malema sought to stress that the EFF did not support the policies of the DA, which he described as a party of &#8220;white racists&#8221;.
&#8220;We are caught between two devils. The DA is a better devil than the ANC. We are not in bed with them,&#8221; he told reporters in the Alexandra township in Johannesburg.
&#8220;The ANC will not get a single vote from the EFF. We will vote for the opposition because the ANC must be removed from power.&#8221;
Malema said his party would work with the ANC only if it removed Zuma, made education free for all, and nationalised banks and mines, among other things &#8212; policies that it is highly unlikely to agree to.
MINORITY GOVERNMENTS
The DA&#8217;s lead negotiator, James Selfe, said his party was confident the EFF would give it the support it needed to form minority governments.
He also said the DA would be able to form a coalition government in Nelson Mandela Bay and several other municipalities without the support of the EFF.
The EFF and DA both said after the Aug. 3 vote that they would not work with the ANC because their supporters had voted for change &#8211; but they are far apart in terms of policy, approach and experience.
The DA is pro-business and has a largely white support base, while the EFF wants to redistribute land from whites to blacks without compensation and has been a disruptive political influence since it was formed three years ago.
Aubrey Matshiqi, a political analyst at the Helen Suzman Foundation, said it was not out of the question that political instability could trigger re-runs of some municipal elections in two years&#8217; time.
The DA won 43 percent of the vote in Tshwane while the ANC got 41 percent and the EFF 12 percent. In Johannesburg, the ANC won 45 percent, the DA 38 percent and the EFF 11 percent.
The rand was marginally higher after weakening late on Tuesday.
 
(Editing by Kevin Liffey)﻿

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