Mining Weekly

JOHANNESBURG (miningweekly.com) – The Chamber of Mines has added its voice to the chorus of parties that are worried about the consequences of President Jacob Zuma’s decision to reshuffle his Cabinet.

Those that were removed from their positions included Finance Minister Pravin Gordhan, his deputy Minister Mcebisi Jonas, Tourism Minister Derek Hanekom, Transport Minister Dipuo Peters, Public Service and Administration Minister Ngoako Ramatlhodi and Energy Minister Tina Joemat-Pettersson.

Most notably Home Affairs Minister Malusi Gigaba will replace Gordhan as Finance Minister, while African National Congress MP Sifiso Buthelezi will serve as his deputy.

The chamber said that it was “seriously concerned” about the dismissal of Gordhan, stating that the move could only be described as “bizarre and difficult to understand,” particularly as it came at a time when South Africa’s sovereign credit rating was at risk and investor confidence in the economy was at a very low ebb. 
 
It agreed with comments made by Deputy President Cyril Ramaphosa earlier in the day that the firing of the “well-respected” Finance Minister was “unacceptable”.
 
“Business, labour and the National Treasury have worked hard over the past year to protect South Africa’s credit rating. Leadership stability and capability in the key Finance Ministry and Treasury are crucial to sustaining progress on avoiding a downgrade,” the chamber emphasised. 
 
Moreover, it stressed that it was equally hard to fathom why “high-performing” Ministers of “exemplary character”, who had worked hard to protect the country’s investment credibility to ensure economic growth could underpin social and transformational objectives, had been axed, while others, who had been embroiled in “crises of huge proportions,” which could have detrimentally affected millions of vulnerable South Africans, have been left unscathed. 
 
Further, the chamber remarked that the events of the past few days had placed South Africa on a “knife’s edge” and would likely negatively impact the country credit rating. 

“Instability serves only further to exacerbate the negative impact on the markets and fuel speculation which is damaging to our country’s reputation as an investment destination.” 
 
The chamber highlighted that South Africa needed to have a Finance Ministry and Treasury that was led by competent, capable and respected people who created the basis for investment, growth and transformation in South Africa’s economy. It noted that it was hard to win investor confidence, but easy to lose it. “At this juncture, the mining industry believes the [Cabinet] changes will lead to instability and reduce investor confidence.”
 
The chamber acknowledged that Zuma had the right to appoint Cabinet Ministers, but said this had to be counterbalanced with accountability and responsibility. 

“The President is beholden, in terms of the Constitution, to serve the interests of the nation. He must promote the unity of the nation and that which will advance the Republic. 
 
“The mining industry urges every one of the country’s leaders to promote the unity of the nation and . . . advance the Republic. It is South Africa and its people that must come first,” the chamber concluded.