Two years after Nhlanhla Nene’s dismissal as finance minister rocked the South African rand, president Cyril Ramaphosa, reinstates his appointment as chief finance minister of the country.
Justifying his decision to shake up things in his government, Ramaphosa stated` “These changes are intended to ensure that national government is better equipped to implement the mandate of this administration.”
The presidents reshuffled cabinet which comes barely 11 days after his election as South Africa’s president served as a comeback for Nene, after his late-night firing by ousted president Jacob Zuma.
Nhlanhla Nene’s appointment, among others, is of interest particularly for his forte at attracting investors. The following day after his termination of appointment, markets reacted extremely negatively, and the South African Rand dropped as much as 5.4% against the dollar in a single day.
Meanwhile, the rand only gained 0.8% against the dollar on reports that Nene was to be appointed. Also, returns on South Africa’s government bonds, which is due in 2026 rose one basis point to 8.03% following the announcement.
During the Zuma exit (zexit) tussle, the rand fell due to political uncertainty and only strengthened, touching its highest level, after rumours that President Jacob Zuma had stepped down.
According to Andrew Canter, chief investment officer, Futuregrowth Asset Management, “The reappointment of Nhlanhla Nene is a positive step in rebuilding South Africa’s fiscal credibility, as South Africa’s renewal lies in the ability to get economic growth and opportunity back on track.”
In agreement, Ramaphosa noted “I have been conscious of the need to balance continuity and stability with the need for renewal, economic recovery and accelerated transformation.”
Hailed by financial analysts for his expressiveness towards criticizing several government spending plans, Nene’s journey as finance minister began in 2008 under president Kgalema Motlanthe’s tenure.
As the state’s finance minister under Ramaphosa, Nene is expected to spearhead efforts to revive the economy that only grew about 1% in 2017, drive down a 27% unemployment rate and rebuild investor confidence in the scandal-rocked country.
Commenting on his new appointment, the 59-year-old minister stated that his attempts to resist being sent back to the post he was unceremoniously fired from just over two years ago fell on deaf ears.
With readiness for the task ahead, Nene stated “I feel it’s time we all rolled up our sleeves, and I trust that the collective is going to give one the required support.”