Johannesburg – President Jacob Zuma’s dismissal of Finance Minister Nhlanhla Nene seems to be the most severe presidential misjudgement since former president PW Botha’s Rubicon speech 30 years ago, the Helen Suzman Foundation (HSF) said on Saturday.
South Africa’s constitutional democracy required accountability of holders of government office: the provision of good reasons for decisions, foundation director Francis Antonie and senior researcher Charles Simkins said in a joint statement.
The president had a particularly salient and stringent responsibility to adhere to the highest standards of accountability, setting the tone for ministers and public servants.
“The need for accountability is never more urgent than when decisions have immediate, strong and adverse consequences. It seems to a great many observers that the dismissal of Finance Minister Nene is the most severe presidential misjudgement since president PW Botha’s Rubicon speech 30 years ago,” they said.
As the news of the dismissal spread, there was a very rapid deterioration in the value of the rand and financial shares were hit hard. The impact was not likely to be brief or quickly reversed.
“The warning shot across South Africa’s bows (the Fitch Ratings downgrade) could not have been clearer. Its response could not have been more foolish… Mr Zuma did not give reasons for the change (of finance minister) but many South Africans suspected it was because Mr Nene had stood up to powerful allies of the president,” they said.
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“Ever since the president’s decision was announced, the HSF has received one communication after another, including from ANC members, expressing grave anxiety about the decision’s economic implications. South Africa’s economy is extremely vulnerable at present, with slowing world economic growth, collapsing commodity prices, a trade gap which widened in October, and the imminent prospect of a United States interest rise.”
The SA Chamber of Commerce and Industry’s business confidence index moved down from 92.8 in February to 82.7 in November. Business Tech reported that in the past three months, foreign investors had sold SA equities and bonds to the tune of R33 billion and R7 billion respectively, according to data from the Johannesburg Stock Exchange (JSE). The Mail and Guardian reported on Friday that billions of rand had been shaved from the value of government bonds.
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“The downgrade in Fitch’s ratings will make things worse. The threat of reaching junk bond status in the foreseeable future is real. If it happens, many institutions abroad will no longer be able to own South African equities and bonds. Adjustments to holdings will be made from now on in order to avoid a fire sale if our sovereign rating drops below investment grade,” they said.
“Above all, our fiscal discipline is being closely scrutinised. Populist and lobby pressure to destroy fiscal discipline is very great. How are we to be reassured that balance will not be lost when the president fires one finance minister to replace him with another considerably less qualified, not to say almost unknown?
“We have observed throughout this year an increasing government desire to escape constitutional and legal restraint. Several aspects of the criminal justice system have been weakened. The public protector has come under vitriolic attack. And now we have a weakened National Treasury. All these developments are accumulating to the point where the quality of our democracy is under threat. To defend it, two political developments are essential.”
The first was that the parliamentary opposition had to be unrelenting both inside and outside Parliament in calling the executive and particularly the president to account.
“It encounters a lack of respect by government supporting MPs for the opposition, regarding it as counter-revolutionary or infantile and a general nuisance to a government with a busy legislative programme, rather than accepting it as a legitimate representative of a part of the electorate. Disrespect engenders disrespect, undermining Parliament as the prime site of an inclusive national debate.”
The second was that accountability within the ruling party itself needed to be strengthened. There was plenty of disquiet within it, including concern about dropping support. An indicator was the emergence of open debate about the presidential succession two years before it needed to be settled.
“We have seen once before how hubris has created its own nemesis, even in happier economic times. Clamping down on internal dissent about policies which make a difficult economic situation worse is likely to be counterproductive, even if calls for unity are made to defend the revolution in danger. The president’s hardest accountability problem may be to his own supporters.”
At no time since 1994 had the need for accountability and the defence of South Africa’s hard-won democracy been as great as it was now. “Either we move forward in consolidating it, or we shall regress to an oligarchic form of rule, inimical to the South African population at large,” they said.
African News Agency
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