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Cape Town - South Africa named Dondo Mogajane as the director general in the National Treasury, appointing an official from within the department’s ranks two months after President Jacob Zuma replaced a respected finance minister and his deputy.
Mogajane, who has been acting in the position since May 16 after Lungisa Fuzile left, will take up the position immediately, Communications Minister Ayanda Dlodlo told reporters in Cape Town on Thursday after a Cabinet meeting. Fuzile’s resignation sparked concern that all three top finance positions would be filled by people from outside the Treasury.
Finance Malusi Gigaba congratulated him “for his appointment in this important position” and wished him well in his future endeavours, Treasury said in a statement on Thursday.
READ: BREAKING: Dondo Mogajane appointed DG of Treasury
S&P Global Ratings and Fitch Ratings cut the nation’s debt to junk after Zuma fired Pravin Gordhan as finance minister and Mcebisi Jonas as his deputy on March 31, replacing them with people with little finance experience. Rating companies cited concern about policy continuity and political instability as reasons for downgrading the country.
Mogajane’s appointment “should be seen as a positive by the market,” Carmen Nel, a strategist at FirstRand’s [JSE:FSR] Rand Merchant Bank [JSE:RMH] unit, said by phone from Cape Town. He “is seen as a Treasury insider, which should inspire some confidence in policy direction and implementation.”
The Democratic Alliance welcomed the appointment. "His appointment puts to rest fears that a rogue, such as Brian Molefe, may have been appointed to the top job at National Treasury," said DA MP David Maynier. "The fact is Dondo Mogajane is a career professional with nearly 18 years of service in senior positions within National Treasury.
"We wish him well because he is going to have his hands full fighting off the fixers, rent seekers and state capturers who are desperate to get their hands on National Treasury."
Fedusa general secretary Dennis George also welcomed his appointment.
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Zuma replaced Gordhan with Malusi Gigaba, the former home affairs minister, but had told party officials that he had favoured Brian Molefe, the former chief executive officer at state-owned power utility Eskom, as finance minister, a person with knowledge of the matter said in March.
Molefe resigned from Eskom in November because of being implicated in the Public Protector's report for favouring members of the Gupta family, who are in business with Zuma’s son, in awarding contracts. Molefe denied wrongdoing and Zuma has challenged the findings. Molefe’s reinstatement at Eskom last month was rescinded after two weeks.
Speculation in Parliament and local media last week that Molefe would be appointed as head of the Treasury prompted Gigaba to tell reporters at a briefing that he wasn’t in line for any government position.
In April, analysts warned that while Molefe served as a Treasury deputy director general almost 14 years ago and would be familiar with its workings should he get Fuzile’s post, it wouldn’t go down well with ratings companies given the governance allegations.
Mogajane joined the Treasury in 1999 and served as chief of staff to Gordhan between 2010 and 2014. He was chief operating officer of the Treasury until mid-2015, when he was appointed a deputy director general.
“It’s positive that someone is appointed who has been there already, who knows the processes and has the institutional knowledge,” Christie Viljoen, an economist at KPMG, said by phone from Cape Town. “It’s also better than if someone was appointed just from a political perspective.”
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