Johannesburg - President Jacob Zuma has started leading from the front in a public relations campaign in defence of state-owned enterprises (SOEs) that are under attack by ratings agencies in his capacity as chairman of a new co-ordinating committee that will oversee these entities.
On Friday, Zuma flew SAA to New York to attend a general assembly of the UN, a rare occasion for the president to use the national carrier.
On his arrival, Zuma was full of praise for the embattled SAA, urging other South Africans to follow suit and use the airline.
Zuma has taken it on himself to defend South Africa’s parastatals, which have come under siege by ratings agencies and will now clearly be the country’s Achilles heel when the agencies review the country.
Zuma has been named as chairman of a new co-ordinating committee that will oversee the SOEs, in a move that is seen as a strategy to neutralise Deputy President Cyril Ramaphosa.
Zuma and Finance Minister Pravin Gordhan sat side-by-side on Friday in a show of scripted solidarity following weeks of speculation that the pair are locked in a bitter power struggle. This was after a high-level meeting with the chief executives of major corporates and labour.
Zuma and Gordhan have been at odds over spending at state-owned companies, plans for a multibillion-dollar nuclear power programme and allegations the president’s wealthy friends influence political appointments, analysts say.
The perceived rift between the two has rattled markets in South Africa, and has lead to more speculation that the country will be downgraded by rating agencies later this year.
Following the meeting at a news conference, they both emphasised the need to work together to address South Africa’s economic problems.
Zuma downplayed the rift and the investigation of Gordhan by the Hawks.
“The question that has been raised whether this meeting discussed (the rift) between the Hawks and the Minister of Finance. No, that was not discussed, I don’t think that was an item on the agenda for this meeting,” Zuma said.
Appeal
“But there was an indication that the manner in which the narrative has been going, negatively in the country, we should not continue with that. (We need) to allow the efforts that we are doing to succeed.
“The more we say things, in whatever setting, whether in government, political and business leaders, it’s not helping. That is an appeal that this meeting has made.”
Zuma added: “We have a few things that have been happening in the country, and we are referring to all of that. Ours is to see us working together. The very fact that we are together here indicates the continuity of the work we are doing.
“We are going to continue with the posture that we have presented to the world, where the leadership of business and government work together to address issues and to indicate where the country is going.”
Moody’s placed five South African SOEs on review for a downgrade last week, citing concerns about funding sources, governance and the political environment.
While South Africa has been spared credit rating downgrades by Moody’s, S&P Global Ratings and Fitch earlier this year, all three have voiced concern about politics and sluggish economic growth.
The economy expanded by an annualised 3.3 percent in the second quarter, avoiding a second recession in seven years.
BUSINESS REPORT