SA prosecutor drops fraud charges against Gordhan
South Africa’s state prosecutor dropped fraud charges against Finance minister Pravin Gordhan yesterday, the latest twist in a police investigation that has rattled financial markets in the continent’s most industrialised economy.
Worries that Gordhan could be prosecuted or even removed from his job have also increased the risk that credit rating agencies would downgrade South Africa to “junk” status, undermining efforts to revive economic growth. The rand gained as much as 1.6 per cent against the dollar, while bonds firmed as the head of the National Prosecuting Authority, Shaun Abrahams, read his decision at a media conference in the capital, Pretoria.
“I am satisfied that... Gordhan did not have the requisite intention to act unlawfully,” Abrahams said. He said he owes nobody an apology and would not resign after the flip-flop on the decision to prosecute.
Gordhan was due to face charges in court on Wednesday that he fraudulently approved early retirement for a deputy tax commissioner and re-hired him as a consultant, costing the revenue service 1.1 million rand ($80,000).
Gordhan, who is widely respected in financial markets, said the accusations were politically motivated. The charges triggered a backlash from opposition political parties, civil society and big businesses.
South African Finance minister Pravin Gordhan during a media briefing in Johannesburg on March 14