High hopes for Nene, Gordhan

AFTER their unceremonious exits from Treasury, Nhlanhla Nene and Pravin Gordhan have returned to crucial portfolios with the expectation that they will rebuild South Africa’s ailing economy and fix stateowned enterprises.

Nene was appointed finance minister, replacing Malusi Gigaba, while Gordhan was chosen to replace embattled Lynne Brown as public enterprises minister after President Cyril Ramaphosa’s first cabinet reshuffle this week.

“These two appointments show the level of seriousness that the new administration is putting to cabinet. They are both competent ministers who are widely respected even by rating agencies and investors,” said Dennis Dykes, chief economist at Nedbank.

After being removed as finance minister last year, Gordhan was appointed as a member of the sub-committee on public enterprises in Parliament. He became increasingly vocal about state capture and was critical of senior officials at SOEs when they appeared before the parliamentary inquiry into governance at the state power utility.

Nene was the country’s finance minister for 18 months between May 2014 and December 2015, when he was axed in favour of David “Des” van Rooyen.

But Van Rooyen was also ousted only three days later. He was replaced by Gordhan, who, in turn, was replaced by Malusi Gigaba as finance minister last year.

Dawie Roodt, chief economist at the Efficient Group, said while the changes were significant steps in boosting investor confidence, economic growth would not be immediate. “There will be a turnaround in investor confidence this year and our average growth will pick up maybe by a percent or two.

“Once investment is improved, it will take maybe two to three years for our economy to be at its best.”