From cat­walk to lion’s den

Es­tab­lish­ment of Brics bank just one of their dis­agree­ments

Sunday Times - - FRONT PAGE - THAN­DUX­OLO JIKA and SA­BELO SK­ITI

MALUSI Gi­gaba was at a fashion show on Thurs­day evening when his phone rang. Pres­i­dent Ja­cob Zuma was on the line with the news that he was mak­ing him finance min­is­ter. The call was a sharp break from the tra­di­tion in nam­ing min­is­ters

TEN­SIONS be­tween Pres­i­dent Ja­cob Zuma and for­mer finance min­is­ter Pravin Gord­han got so bad they could not even agree on a Brics bank due to be built in South Africa.

Claims have emerged that the stand­off has de­layed the es­tab­lish­ment of the bank, as the two were un­able to agree on a lo­ca­tion and staffing is­sues.

The bank is meant to fund big in­fra­struc­ture projects worth bil­lions of rands in Brazil, Rus­sia, In­dia, China and South Africa.

“The Brics col­leagues fol­low our do­mes­tic pol­i­tics. It’s an em­bar­rass­ing yet se­ri­ous is­sue,” a se­nior gov­ern­ment of­fi­cial said.

“We are still strug­gling to set up the Africa re­gional cen­tre of the bank, as an­nounced a year ago. This is be­cause PG and JZ dif­fered on lo­ca­tion and staffing is­sues.

“JZ wanted to nom­i­nate his peo­ple but PG in­sisted on pro­fes­sion­als with proven bank­ing ex­per­tise and ex­pe­ri­ence.”

Zuma is said to have told the ANC’s top six lead­ers this week he had to fire Gord­han as the re­la­tion­ship be­tween them had ir­re­vo­ca­bly bro­ken down.

The Na­tional Trea­sury an­nounced the es­tab­lish­ment of the New Devel­op­ment Bank head­quar­ters in Shang­hai, China, in Fe­bru­ary last year, following a for­mal agree­ment be­tween Brics lead­ers at the body’s fifth an­nual summit, in South Africa, in 2013.

Gord­han said in his bud­get speech last year that the bank was es­tab­lish­ing its Africa re­gional cen­tre in Johannesbu­rg.

When Zuma fired Gord­han’s pre­de­ces­sor, Nh­lanhla Nene, in De­cem­ber 2015, he said Nene was set to lead the bank, but that never ma­te­ri­alised.

This week, South Africa also failed to at­tend the Brics bank’s an­nual board of gov­er­nors meet­ing in Delhi, In­dia. It was the first time South Africa had not at­tended the meet­ing, which is the high­est de­ci­sion-mak­ing meet­ing of the bank out­side Brics and is at­tended by finance min­is­ters of all Brics coun­tries.

South Africa could not send any del­e­gates to the meet­ing, which was held on Wed­nes­day and Thurs­day this week, be­cause of the cab­i­net reshuf­fle.

Asked what had caused the de­lay in es­tab­lish­ing the bank, De­part­ment of In­ter­na­tional Re­la­tions and Co-op­er­a­tion spokesman Nel­son Kg­wete re­ferred ques­tions to the Na­tional Trea­sury and the Pres­i­dency.

Pres­i­dency spokesman Bon­gani Ngqu­lunga said the es­tab­lish­ment of the bank was go­ing ahead. “Work is pro­ceed­ing well. Pres­i­dent Ja­cob Zuma ap­pointed an in­ter­min­is­te­rial com­mit­tee on Brics and among its pri­or­i­ties is to over­see the es­tab­lish­ment of the bank. The [com­mit­tee] looks at the Brics bank and other ar­eas of co-op­er­a­tion within the Brics frame­work,” said Ngqu­lunga.

The bank is­sue is just one of many ten­sions that led to Gord­han be­ing fired. He also had stand­offs with var­i­ous min­is­ters, in­clud­ing Faith Muthambi, who has been moved from com­mu­ni­ca­tions to the pub­lic ser­vice and ad­min­is­tra­tion port­fo­lio, and So­cial Devel­op­ment Min­is­ter Batha­bile Dlamini over their fail­ure to fol­low proper pro­cure­ment pro­cesses in their de­part­ments.

Gord­han also bumped heads with SAA chair­woman Dudu Myeni, a close as­so­ciate of Zuma, and was en­gaged in a spat with Wa­ter and Sanitation Min­is­ter Nomvula Mokonyane over the mul­ti­mil­lion-rand Mz­imvubu wa­ter project in the East­ern Cape.

Muthambi and Gord­han clashed over the Trea­sury’s in­ves­ti­ga­tion into the SABC splash­ing out R40-mil­lion in 2015 on a “state-of-the-art stu­dio”, which was lit­tle more than a hi-tech pre­sen­ters’ ta­ble with mul­ti­ple screens.

The of­fice of the chief pro­cure­ment of­fi­cer re­quested ten­der doc­u­ments from the SABC as it had not gone through nor­mal pro­cure­ment pro­cesses.

The SABC has to date not pro­duced the doc­u­ments. In­stead, Muthambi wrote to Gord­han telling him she was un­happy she had not been in­formed about the in­ves­ti­ga­tion.

In a letter seen by the Sun­day Times, she said: “The de­part­ment finds it un­for­tu­nate that the Na­tional Trea­sury has de­cided to con­duct an in­ves­ti­ga­tion into the SABC without the cour­tesy of in­form­ing me as the min­is­ter, who is the share­holder in the SABC on be­half of the South African gov­ern­ment.”

Gord­han clashed with Dlamini over the pay­ment of so­cial grants, as the de­part­ment’s con­tract with Cash Pay­mas­ter Ser­vices was com­ing to an end. In their correspond­ence, Dlamini re­jected Gord­han’s pro­pos­als on how to pay ben­e­fi­cia­ries and in­stead ac­cused the Trea­sury of over­step­ping its du­ties.

At a press con­fer­ence this week, Gord­han said: “There’s no such thing as the Trea­sury de­cid­ing to do X. The Trea­sury does not de­cide on its own. The Trea­sury could make rec­om­men­da­tions, the budgeting process goes through a tech­ni­cal process which is chaired by our DG . . . Ul­ti­mately the de­ci­sions are made in cab­i­net and what I present are mat­ters that have been agreed by cab­i­net.”

JZ wanted to nom­i­nate his peo­ple but PG in­sisted on pro­fes­sion­als No such thing as the Trea­sury de­cid­ing to do X. De­ci­sions are made in cab­i­net

Pic­ture: MOELETSI MABE

IN CALMER TIMES: Pravin Gord­han and Pres­i­dent Ja­cob Zuma at a con­fer­ence in 2015, when Gord­han was min­is­ter of co-op­er­a­tive gov­er­nance

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