Richard Branson: SA needs Gordhan to steer country into safe waters | Fin24

Richard Branson: SA needs Gordhan to steer country into safe waters

Oct 31 2016 14:29
Matthew le Cordeur

Cape Town - The wrong decision made today could have been devastating for South Africa, multibillionaire Richard Branson, founder of the Virgin Group, said on Monday.

"It’s wonderful, wonderful news that your finance minister has been exonerated today," he said. "It’s great to see some stability brought back to South Africa.”

He was reacting to the announcement by National Prosecuting Authority head Shaun Abrahams that all fraud charges against Finance Minister Pravin Gordhan and his former colleagues at the SA Revenue Service have been dropped with immediate effect.

“I have decided to overrule the intention to prosecute. I have directed the summonses to be withdrawn with immediate effect,” said Abrahams.

Gordhan was scheduled to appear in court on Wednesday.

Speaking at the official launch of Virgin Money South Africa’s newest venture, Virgin Money Insurance, Branson said the right decision has been made as South Africa needs somebody at the wheel of the ship to steer it into sound and safe waters.

"Otherwise South Africa could go on the rocks very easily. I think what happened today is very, very important for South Africa."

Although he was very happy that Gordhan was let off the charges, Branson jokingly said it's a pity it didn't happen a week later, because now, while on holiday in Cape Town, he'll get fewer rands for his pounds.

WATCH: Richard Branson's speech

The rand strengthened 1.8% against the dollar, 2.1% against the euro and 2.06% against the pound following the news.

The rand rallied to below R13.60/$ during Abrahams' lengthy speech ahead of his announcement that charges have been dropped against Gordhan and his two co-accused, Oupa Magashula and Ivan Pillay.

Ahead of the briefing, the rand had strengthened, trading at R13.81 on Monday morning when markets opened. This is close to levels recorded on October 10 before the NPA announced plans to charge Gordhan.

READ: Rand strengthens ahead of NPA press briefing

On October 11, when the NPA announced it would charge the trio for fraud, the rand skyrocketed to R14.36 against the dollar.

The local unit traded as low as R13.58 against the greenback during Abrahams' speech and by 13:52 was trading at R13.56/$. That is 198% firmer than the unit's previous close against the greenback.

Abrahams lamented Gordhan’s refusal to make representations to the NPA, and said Magashula and Pillay  received a fair hearing.

The NPA still on Sunday insisted there were no plans to drop fraud charges against Gordhan and his two former deputies, rebuffing a City Press report.

The newspaper’s story is “without merit,” NPA spokesperson Luvuyo Mfaku told Bloomberg by phone on Sunday.

Fin24's sister publication City Press said informal talks were under way between prosecutors and Gordhan’s lawyers about dropping the charges before the upcoming court date on November 2. The newspaper cited a senior official close to the chief prosecutor, a source close to the finance minister and a letter drafted by prosecutors.

WATCH: Richard Branson on Brexit, Trump and investing in SA

VMI is a short term insurance partnership with AIG and its launch follows an intense journey to better understand the consumer’s motivation for purchasing insurance, Branson said.

Branson described Gordhan as a "tremendous, fantastic individual" who epitomises the stability that South Africa needed.

Gordhan was under investigation over the early retirement of Pillay, which the NPA said resulted in R1.1m of allegedly wasteful expenditure. 

“I am satisfied Mr Pillay, Mr Magashule and Minister Gordhan did not have the requisite intention to act unlawfully," Abrahams said.

An investigation into allegations that Gordhan oversaw the establishment of an illicit investigative unit during his tenure as Sars is ongoing.

Photos from the launch:

Richard Branson hitched a ride up the red carpet into Shimmy's nightclub in Cape Town on Monday in a mini green car - the same one used in Virgin's South African TV advert promoting Virgin Money Insurance. (Photo: Matthew le Cordeur)

Media guests were served virgin cocktails on arrival. (Photo: Matthew le Cordeur)

Richard Branson is also in South Africa to celebrate the recent news that Virgin-owned Ulusaba Private Game Reserve was ranked the best safari and resort in Africa by Conde Nast Traveller in October. (Photo: Matthew le Cordeur)

A member of Virgin Limited Edition’s award-winning collection of retreats, the resort is located in the Western sector of the Sabi Sand Private Game Reserve. SEE THE GALLERY.

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