South Africa’s Gordhan breaks off roadshow, says he’s still finance minister

Reuters: South African Finance Minister Pravin Gordhan abandoned an investor roadshow and flew home on Tuesday on the orders of President Jacob Zuma, triggering speculation about his future that weakened the country’s currency and bonds.

Gordhan, widely seen in financial markets as a guarantor of stability, said “yes” when asked by a reporter if he was still the finance minister - a comment that helped trim the rand’s losses to 1 percent against the dollar. ZAR=D3

“I think ask the presidency,” he said when asked if he knew why he had been summoned home.

Zuma’s sudden recall cut short Gordhan’s roadshow in Britain and the United States, triggering jitters that a long-running power struggle between the two men was coming to a head and might threaten more turmoil for Africa’s most developed economy.

Talk Radio 702 said Gordhan’s dismissal had been discussed on Monday at talks between Zuma and the South African Communist Party, allies of the ruling African National Congress (ANC).

ANN7 television said the six most senior members of the ANC had approved Gordhan’s removal, citing unnamed sources. ANC Secretary-General Gwede Mantashe, one of the six, told Reuters he could not comment on the report.

On arrival, Gordhan went to the ANC’s Luthuli House headquarters in downtown Johannesburg. He then went to a court in the capital Pretoria where he attended a hearing of a case concerning the closure of bank accounts belonging to friends of the president, the Gupta brothers. The case has long been a bone of contention between Zuma and his finance minister.

“The president is my boss so if he asks us to come back, we come back,” Gordhan said.

“There are many in government who want to do the right thing and make sure we keep our economy on track and keep our development moving in the right direction,” he added, without elaborating.

The National Treasury said in a statement that investors at the roadshow, whose U.S. leg was cancelled on Zuma’s orders, were concerned about the political environment at home.

“Investors expressed concerns about the political environment and the risk that it could divert attention from setting policies aimed at accelerating growth and creating more work opportunities,” the Treasury said.

Some pundits say Gordhan is being pressured by a faction allied to Zuma, which has criticised his plans to rein in government spending as the economy stagnates and rapped his running of the tax agency. Gordhan has wrangled for months with the head of the agency, a Zuma ally.

The main opposition Democratic Alliance party asked Zuma to explain why he had ordered the minister home. “Why does he simply not tell South Africa?”, it said in a statement.

Gordhan first served as finance minister from 2009 to 2014 and was brought back by Zuma in December 2015 to calm markets spooked by the president’s decision to replace his respected successor, Nhlanhla Nene, with a little-known politician.