During the past week in Johannesburg I’ve gotten together with colleagues, caught up with old friends, and switched my observation radar to the max. Until Monday morning, although the mood was decidedly bluer than when we relocated a year ago, things seemed stable enough. But just when you thought it was safe to go back in the water…
President Jacob Zuma’s shock recall of respected Finance Minister Pravin Gordhan from a global investment roadshow hit the business community like a mugger with a baseball bat. The last time I saw such panic and despondency from usually rational people was in December 2015. We called that Nenegate. This one’s name is still being designed.
After Zuma’s announcement the Rand took a predictable smack, but with the optimists still hoping for the best, the currency stabilised yesterday. It remains fragile and likely to take another hit when Gordhan’s departure is officially announced. But provided his replacement isn’t the noxious Brian Molefe – which we believe it isn’t – expect the Rand to soon steady around current levels.
For anyone with even one rational braincell, though, the message is clear. Use the opportunity to suck out any currency you have left in the country. With Gordhan gone and Zuma flexing his muscles, the ANC’s economic mismanagement is about to ratchet higher. And with the unpredictable 74-year-old prepared to do whatever it takes to serve his own interests, another currency-smashing shock is bound to be just around the corner.
The wise ones say a country gets the leadership it deserves. It’s hard to believe that’s true in SA’s case.
