JOHANNESBURG — It was sad to see the back of Nhlanhla Nene after all he did for South Africa, but in the spirit of good governance, a foreign concept in the Zuptoid world, it had to happen. Nene saved the country from a nuclear catastrophe, and for that South Africans must be grateful. But as with any succession, it’s not the character of the person leaving we should be concerned about, but rather the replacement itself. And in Tito Mboweni, South Africans have a well equipped replacement Finance Minister, who it must be said has a lot on his day old plate. Biznews publisher Alec Hogg was interviewed on Winslyn by presenter Divan Botha, to get his thoughts on the change. – Stuart Lowman
Na die afgelope week se drama rondom nou voormalige Minister van Finansies Nhlanhla Nene se betrokkenheid by die Guptas, het President Cyril Ramaphosa vroeër vanaand aangekondig dat Nene vervang is met Tito Mboweni. Alec Hogg sluit nou via Skype by my aan om oor hierdie aanstelling te gesels. Hallo, Alec.
I hope London is treating you well. Alec, do you know Tito Mboweni personally? Give us some idea, what kind of a person is he?
He’s funny, he’s smart, he’s full of stories, he is very experienced and he’s 59 now, he became a Cabinet Minister in the Mandela Cabinet when he was 35 so obviously, a man with a lot of talent.
That was my next question. Do you think he’ll be a competent Minister of Finance?
Divan, I was very sad that Nhlanhla Nene, after all he’s done for the country, lost the job but it is a governance story and at least he went out with a big pat on his back. If there is any upside in this, it’s that he’s been replaced by a better man for the job at the moment. So, definitely, you can’t get better than Tito Mboweni. He was an excellent Reserve Bank Governor. When he was appointed 20-years ago, around about this time of the year, I was very critical saying that a politician should never be running the monetary policy of a country. Well, I was wrong. It took me a few years to talk to Tito again but when we did share a cup of tea, I apologised to him for thinking that he was going to be just like any other politician, he wasn’t. This is an independent man, an independent thinker, and he’s going to be a very good finance minister.
V good to see Tito #Mboweni return to the policymaking scene in #SouthAfrica as finance minister.
I had the pleasure of interacting with him when he was central bank governor. Highly capable, smart, engaging and dedicated, he's greatly admired for his accomplishments as governor.
— Mohamed A. El-Erian (@elerianm) October 10, 2018
He’s got quite an interesting history but for the last while, the only critique is that he’s been receiving is the kind of personality that he’s portraying on Twitter and also, the views that he’s expressing on Twitter. Do you think it’s just a view of a retired politician that didn’t ever think that he was going to go back into Government? Or do you think we should be…? What should we expect from him?
He’s 59 years old so he’s got a lot of energy left. He has been the chairman of a few listed companies, big companies, AngloGold amongst them. He is definitely going to be putting his heart and soul into this. Cyril is an old friend of his, they are hard-boiled the two of them over many years. They know each other. He knows that Tito comes without any surprises, he comes with a wonderful international pedigree, and we’ve seen it. We’ve seen it in the Rand today. The rand has just got stronger and stronger, since the announcement. It has risen from R15.04, before the announcement, it’s now trading at R14.54. So, he’s given us 50-cents in the Rand, that’s more than 3% improvement in SA’s wealth, relative to other countries. We should thank Tito, he’s made us all a little richer tonight.
It’s interesting. It’s equally important for the Finance Minister to be able to work with different Departments and the different DGs. Now, that relationship has been quite interesting between the previous finance minister and these different departments. Do you think Tito has the kind of personality to really get people to march in the same direction because he needs these guys, and the DGs in all the departments, to really do well?
Divan, the DGs will respect him. They know that he has been the Central Bank Governor of the year for Africa, I think on more than one occasion. They know that he rubbed shoulders with people like Alan Greenspan, legends in the Central Banking area. They also know that he understands business. They also know that he has a big pedigree within the ANC (within the ruling party), he’s got that respect and he’s charming but he can also be pretty firm. So, he’s got it all. Things can always go wrong but SA, at the moment, needs a really good and strong Finance Minister who understands the economic challenges, and he does. He’s not going to be going back and doing Venezuela-styled socialism. What he will be doing is applying the things that actually work, capitalism, socialism, or free market, who cares? It’s just the stuff that works and for that, I think we’ve got ourselves a very able and a very good replacement for Nhlanhla Nene.
So, we know that the Rand has reacted positively. You’re in London, give us some idea what the investors are saying and what the Brits are saying, at this stage?
Well, the Brits at this stage, have only just heard about it so, I’m expecting… I talk to quite a lot of people who are considering investing in SA. They tap in and I do a little bit of consulting on that front, and up to now, there’s been enormous nervousness. I think with Tito coming in as Finance Minister that might just shift the odds in the favour of actually going ahead and making that investment. Remember, SA is having a difficult time. It’s also got this huge decision coming up from Moody’s later this month. The appointment of Mboweni might just save SA’s investment grade rating.
Alec, it’s always a pleasure and thanks for making time at such short notice. Thank you so much.