Cape Town – President Jacob Zuma on Monday ordered Finance Minister Pravin Gordhan and Deputy Finance Minister Mcebisi Jonas to abandon talks with foreign investors in the United Kingdom and United States and return home, prompting the rand to fall amid fears of a Cabinet reshuffle.
"President Jacob Zuma has instructed the Minister of Finance, Mr Pravin Gordhan, and Deputy Minister Mcebisi Jonas to cancel the international investment promotion roadshow to the United Kingdom and the United States and return to South Africa immediately," Zuma’s office said in a statement.
The presidency did not respond to enquiries as to the reason for the move.
The Democratic Alliance demanded that Zuma explain his motives, and said the development bode ill for the economy. "The instruction to cancel the international investor roadshow without explanation is so bizarre that it appears, at best, calculated to humiliate the minister or, at worst, to suggest that the minister is about to be fired in a cabinet reshuffle," DA finance spokesman David Maynier said.
National Treasury officials appeared caught off guard by the turn of events and could not immediately comment.
It comes after more than a year of tension between Zuma and the finance minister, and amid speculation that Gordhan and Jonas would be removed from their posts in an imminent cabinet reshuffle.
Gordhan has openly and frequently referred to the uncertainty of his situation. Earlier this month, he told Parliament's standing committee on public accounts that National Treasury came under political pressure when it was obliged to intervene when other government departments failed to do their job.
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"We get into this sloganeering … contain Treasury, take over Treasury. You have all heard it, and I don't think it is child's play at the end of the day." He added: "I am still standing."
Bloomberg reported on Monday that the minister told the international news agency he intended to conclude his engagement with foreign investors in London. He had been due to return to South Africa on Monday night. Jonas was supposed to embark on the investor roadshow to the United States on Monday night.
On Tuesday, the Pretoria High Court is set to hear Gordhan's application for a declaratory order that he could not intervene on behalf of the politically-connected Gupta family in commercial banks' decision to close their accounts. The case has seen the finance minister lift the lid on banking transactions by companies in their business empire that were flagged as suspicious by the Financial Intelligence Centre.
The news that Gordhan had been ordered home appeared to have had an immediate impact on the rand.
"After reaching R12.31/USD, R13.38/EUR and R15.45/GBP today on its recent strengthening trend aided by international factors the rand then weakened markedly on market rumours that the National Treasury's road show was interrupted as Finance Minister Gordhan was purportedly instructed to return to SA," Investec said.
Bloomberg said the rand weakened as much as 1.9 percent against the dollar on the back of Zuma's instruction to Gordhan and Jonas.