Many South Africans (generally a hopeful bunch) will be looking forward to seeing evidence of a new dawn in Tito Mboweni’s first Medium Term Budget Policy Statement as Finance Minister on October 24, but only the most optimistic expect a model of budget policy and planning.
It is reasonable to hope for a departure from the disappointments of the last few years, but let’s not forget there is a rather large hole out of which South Africa must start digging itself. Let’s hope Mboweni, who was so respected during his tenure as Governor of the Reserve Bank, is able to give some clarity on plans for doing that.
Both South Africans and the global markets will be watching very closely to see if Mboweni can still garner the respect and provide the market stability that he was well known for during his tenure at the Reserve Bank. This will be much needed if Mboweni is to successfully transition South Africa back to a path of positive economic growth that is so desperately needed.
His recent appointment after President Cyril Ramaphosa accepted Nhlanhla Nene's resignation as Finance Minister sent a very strong signal to the market that he was serious about turning the tide on the Zuma years.
Nene had offered his resignation after his testimony at hearings of the State Capture Commission confirmed that he had attended meetings with the controversial Gupta family, something that he had previously denied. The widely respected Nene, who had previously been fired by the former president, Jacob Zuma, for what is widely considered to be ‘doing the right thing’, had offered his resignation because there was a risk that developments around his testimony would detract from “the important task of serving the people of South Africa”.
President Ramaphosa quickly announced that he was accepting Nene's resignation "in the interests of good governance". South Africans are hoping to see more evidence of good governance when Mboweni stands up to address Parliament on Wednesday afternoon.
*Mica Townsend has a BSc in Economics and Management from Royal Holloway, University of London. Formerly a Private Banker at Barclays Wealth in London, Mica came to South Africa on a six-month secondment and never went back. Before joining 10X Investments at the beginning of 2018, Mica, who is a chartered financial analyst (CFA), worked in offshore wealth management at deVere Acuma.
