Nene facing severe credibility problem as mid-term budget looms, say analysts

2018-10-09 07:11
Nhlanhla Nene (File, Netwerk24)

Nhlanhla Nene (File, Netwerk24)

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As South Africa prepares for a mid-term budget – due to be delivered in two weeks' time – rumours are flying thick and fast about the fate of Finance Minister Nhlanhla Nene.

Some say that his term as minister is likely to come to an abrupt end, following reports that he asked President Cyril Ramaphosa to release him. If that's the case, it will be the second time that he fails to complete a term as minister.

READ: Nene asked to resign in phone call to Ramaphosa

The development follows Nene's apology to South Africans over lying about having meetings with the controversial Gupta family.

Nene admitted, while giving testimony at the state capture commission of inquiry, that he had visited the Gupta home no less than six times when he served as deputy finance minister and at the start of his tenure as minister.

SCROLL: Will Finance Minister Nhlanhla Nene go or stay?

He was fired in what he claimed was a two-to-three-minute meeting with former president Jacob Zuma in December 2015. He claims it was over his refusal to toe the line over a possible nuclear deal with Russia.

There has been much talk about finding a replacement for Nene. Rumour has it that Barbara Creecy – who serves as Gauteng's finance MEC – tops possible replacement lists.

Commenting on the issue, research director at the Mapungubwe Institute for Strategic Reflection, Ralph Mathekga, said: "Nene is going to be a liability."

"My view is that the credibility problem that Nene has run into is very severe."

Mathekga told News24 that Nene deliberately allowed South Africans to create an anti-corruption character out of his struggles with Zuma, saying that he played along with this while fully aware that it was a lie.

"Half of the discussions are not going to be about the substance of the budget. The Nene crisis will cloud the budget," Mathekga warned.

"Already the cloud is gathering around this man who is going to deliver the budget. We are not going to focus on the budget but the credibility of the messenger," insisted Mathekga.

ALSO READ: Nene resignation won't compromise mini budget - economists

Wits School of Governance's Professor Ivor Sarakinsky shares this view, but believes the story has moved on from the embattled finance minister to his boss, Ramaphosa.

"If you are going to have someone delivering something as important as the mid-term budget, you are going to need for there to be no ambiguity about it. It's a very, very important document," said Sarakinsky.

Describing Ramaphosa's latest challenge as being caught between a rock and a hard place, the governance professor said Nene had left it up to the president to decide whether he had been doing a good job or deserved to be fired.

"He has to weigh up whether he can he afford to have someone facing serious controversy to deliver that (the mid-term budget) or would it be astute to get a new person in?" Sarakinsky asked.

The professor said the added difficulty for Ramaphosa came with trying to please markets, overseas investors and overall perceptions during an already difficult economic period.

Ramaphosa is yet to make a statement about the allegations.

READ: Still no word on Nene's fate following his offer of resignation 

Read more on:    cyril ramaphosa  |  nhlanhla nene  |  economy

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