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The six potential candidates who could replace Gordhan

Mar 30 2017 05:32
Liesl Peyper

Cape Town – With Finance Minister Pravin Gordhan and his deputy Mcebisi Jonas highly touted to be replaced in a Cabinet reshuffle, the question remains who will replace them. 

Rumours are rife that Gordhan and Jonas will soon be removed by President Jacob Zuma following a surprise recall on Monday from an international investor roadshow, barely a day after they started the week-long excercise to the UK and  US.

Gordhan and his entourage landed in South Africa on Tuesday morning after Zuma ordered them to come home immediately. The rand felt the brunt on Monday, weakening from a near two-year high of R12.31 to last trade at R13.04/$.

Responding to Fin24's request for comment, Nomura emerging markets economist Peter Attard Montalto said he believes a Cabinet reshuffle will extend wider than just the finance ministry. 

“In terms of the political dynamic of a reshuffle, Zuma will see the need to remove the perceived threat of SACP Cabinet members."

READ: Cabinet reshuffle much bigger than Gordhan - economist 

This, of course, also encompasses Jonas, who has been outspoken about state capture and its threat to derail South Africa as a developmental economy. 

Six potential candidates for Gordhan's job (or some role in Treasury)

Montalto believes there are six candidates, up from last year's four, for the top finance ministry job, including the need for a new deputy. He, however, notes that any replacement of either Gordhan or Jonas would be to facilitate tenderpreneurship and patronage. 

“The two key boxes that need ticking are a candidate that is fiscally conservative and anti-patronage - someone that would uphold the Public Finance Management Act. We don’t believe we can say any of the candidates mentioned would meet these criteria.”

His picks are:

Brian Molefe (most likely), recently sworn-in Member of Parliament and former Eskom CEO, who was named in former public protector Thuli Madonsela’s state capture report for his close ties with the Gupta family. 

Molefe was widely touted as possible finance minister and the Zuma camp will no doubt promote his extensive experience at National Treasury, where he served as a senior manager. He moved on to run the Public Investment Corporation where he took on big companies for not appointing enough black South Africans to their boards, the Sunday Times reported. 

Molefe also had a successful stint as Transnet CEO before he was seconded to take over the reins at Eskom in 2015, which at the time was plagued by blackouts and management troubles. 

In November last year, Molefe tearfully resigned from the power utility after he was named in the State of Capture report. He said at the time he was doing so to “clear his name”. 

His name was widely touted as a possible to take over the position last year. The Zuma camp would likely promote his previous experience at the Treasury.

Des van Rooyen (less likely, worst market reaction), current Minister of Cooperative Governance and Traditional Affairs. The former ANC backbencher had a four-day stint as finance minister when he replaced former finance minister Nhlanhla Nene, who was unceremoniously sacked by Zuma on December 9 2015. He was then moved to the cooperative governance portfolio. 

Montalto is of the view that Van Rooyen, who Zuma once called “the most qualified finance minister” because of his business qualifications, could make a comeback. He is however deemed a “Gupta deployee” by the business community and financial markets. 

Sfiso Buthelezi (possible, difficult to gauge market reaction), current ANC MP serving in Parliament’s standing committee on finance. A former businessman, believed to be close to Zuma, Buthelezi makes all the right noises in committee meetings, criticising National Treasury for not taking a tougher stance against corporates and not giving enough credit to the “good work” done by the South African Revenue Service. 

City Press earlier reported that Buthelezi, an economist by profession, had resigned as chief operating officer at the Makana Investment Corporation (an investment vehicle for former political prisoners). He is also a former chairperson of the board of the Passenger Rail Agency of South Africa. 

Kgosientsho Ramokgopa (moderate chance, difficult to gauge market reaction), former Tshwane mayor who has not yet been deployed to a party position.  

Montalto said Ramakgopa is believed to have shifted from being in the anti-Zuma camp to the pro-Zuma camp and is seen as a capable pair of hands technically. 

According to the website, Ramokgopa is the former CEO of the Metropolitan Trading Company and holds a PhD in local government finance, obtained from the University of Pretoria.

Nkozosana Dlamini-Zuma (less likely for Finance Minister, could be more market positive), the former Health and Home Affairs Minister, AU President, candidate for President of ANC in December.

"While we think she could be in contention the whole point of her entering Parliament is that she needs a high profile role that has a low workload so she can go out and campaign for the ANC’s elective conference at the end of the year. A finance minister position is definitely not that,” said Montalto, adding that a new portfolio, such as minister of transformation, could be a possibility. 

Makhosi Khoza (uncertain chance, could appear elsewhere in a reshuffle), former member of the parliamentary finance committee, now chair of the public services committee, Montalto believes she is loyal to President Zuma.

READ: Molefe finds new home as MP, and it's not finance - report

Khoza was considered a rising star in Parliament’s finance committee and also chaired the ad hoc committee which appointed the new public protector. Most recently, she was a member of the ad hoc committee that looked into the dismal state of affairs at the SABC. 

A former CEO at a number of corporate companies, she holds a PhD in administration and a master’s degree in social science (policy and development studies), and is a fellow at the Aspen Global Leadership Institute. 

In addition, she is currently studying towards a master’s degree in finance at the University of London.

Political analyst Daniel Silke believes Buthelezi is “the one to watch”, along with Dlamini-Zuma.

“I have always felt that should Pravin Gordhan be replaced, Zuma is more likely not to appoint Molefe to that position and could offer him an unrelated position – perhaps as a deputy in another portfolio."

Silke says the replacement of Gordhan has to be – even for Zuma – someone who will be broadly acceptable in both political and business circles and Buthelezi fits that bill. 

“I therefore see him as a potential frontrunner.”

He concurs with Montalto that Dlamini-Zuma clearly needs a portfolio that is not too demanding (given her possible presidential campaign) or one that needs “rescuing”, which would make her look good.

“Ultimately, she does not need a poisoned chalice portfolio.”

SACP 'won't be sidelined'

Silke, however, is of the view that Zuma will not “sideline” the SACP Cabinet members so as to give the party an overt excuse to exit the tripartite alliance and contest the ANC’s presidential elections on its own. 

“(Derek) Hanekom (Tourism Minister who led the charge in the National Executive Committee asking Zuma to step down) may get the chop and Blade (Nzimande, Higher Education Minister) may be moved to another portfolio."

The issue, Silke says, is whether non-performing ministers are retained for their political clout or whether “clear failures” are replaced with real talent.

“My concern is that a reshuffle will be directed at protecting President Zuma and possibly boosting Nkosazana (Dlamini-Zuma), thus isolating (Cyril) Ramaphosa within Cabinet.” 

Pictures: Gallo Images, Netwerk24

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