Gigaba in line for some strange advice

IT would be churlish, if not self-defeating, for South Africans not to wish new Finance Minister Malusi Gigaba the best of luck as he sets up his stall in the US, hoping to persuade international investors that South Africa is still open for business despite the heavy blows of the credit downgrades inflicted upon us after the unceremonious dumping of Pravin Gordhan.

We are assured by the ANC top brass that Zuma had to axe Gordhan because of a “breakdown” in the relationship between the president and the former finance minister, a man respected in the financial capitals of the world. That irritant out of the way, we are told, it’s now business as usual.

One might have thought, though, that at this juncture, with the economy in the doldrums and the ratings agencies sharpening their knives, that Zuma might have been able to put aside his supposed differences with Gordhan — in the broader interests of South Africa. But no.

That he was not able to do so, going so far as to call Gordhan back from an investor roadshow to eject him from the finance hot seat, may speak volumes about his real intentions, namely the capture of the National Treasury. The aim is to serve his own and his family’s interests, and the interests of the Gupta family and all those who benefit from their access to state resources, not the least of these being Eskom.

Of course, tensions between the executive of any government and its treasury are common, and indeed desirable if a country is to avoid spending itself into a big hole which it and its people can hardly afford. Remember Greece?

So even if we take Zuma at his word (and why would we, given his track record), that not much will change, the omens are not promising. Already, long-serving Treasury director-general Lungisa Fuzile has packed it in, and there is talk that other Treasury stalwarts may soon follow. Let’s hope their departure does not open the fiscal floodgates for spending on unnecessary nuclear projects and other big-ticket items while many still live on the unglamorous sidelines of our opulent society.

One wonders whether Gigaba’s audience in the US has had sight yet of this week’s Business Times, in which Gigaba’s new adviser, Chris Malikane, sets out his lurid diagnosis of South Africa’s economic problems, and his cure.

In it, Malikane assures us the National Treasury is the “cornerstone of the ownership and control of the state by white monopoly capital”. He says we are “fatigued with the growth rhetoric”; the country is “yearning for transformation”. Fatigued by growth in the lower fractions, perhaps.

Quite how Gigaba intends explaining Malikane’s role in his ministry could be interesting. He can hardly be dismissed as a necessary, but ignored, radical voice in a choir of reasonableness. And if what he has to say is not accepted as the outline of a policy, why engage him? Presumably, Malikane’s thinking is very much in line with what Gigaba and his boss have in mind. If that is so, stand by for further downgrades.

The Treasury will no longer be hostage to white monopoly capital. But it will still serve interests just as narrow.