Johannesburg - President Jacob Zuma’s agreement to dump his “Weekend Special” Finance Minister David van Rooyen and replace him with Pravin Gordhan brought stability back to the JSE’s hard hit financial and property heavyweights on Monday.
The 17 stocks that are in the JSE’s Top 40 regained R118bn of the losses sustained in the previous two sessions. Such was the value ascribed by investors to the re-installing of Gordhan as Finance Minister.
But the breakdown of trust caused by Zuma’s blunder still weighs heavily on these barometers of global confidence for South Africa’s financial system.
Even after Monday’s rebound, the market capitalisation of those 17 stocks remains R171bn below where they closed ahead of Nene’s firing on Wednesday night.
Translated into everyday language, that’s the easily qualifiable cost of what Zuma’s antics cost the country. Add the hit sustained by the rand and value of bonds, and the national loss is clearly north of R200bn.
The obvious question now is whether South Africa can afford to keep such an expensive President?