South Africa's Zuma replaces Gordhan as Finance Minister

Reuters News
Posted: May 25, 2014 2:00 PM

JOHANNESBURG (Reuters) - South African President Jacob Zuma promoted deputy finance minister Nhlanhla Nene to finance minister on Sunday, replacing the widely respected Pravin Gordhan in a new cabinet line-up at the start of a second five-year term in office.

The day after a glitzy inauguration in Pretoria, the 72-year-old Zuma also confirmed millionaire businessman Cyril Ramaphosa as his deputy president, a decision likely to go down well with investors and the private sector.

Mining minister Susan Shabangu, who has been criticized for her handling of a strike in the platinum mines now in its fifth month, was replaced by Ngoako Ramatlhodi, a former deputy minister in the prison service.

Nene, 55, has been number two at the Treasury in South Africa's most advanced economy since 2008 and is seen as a capable technocrat familiar to domestic and international investors.

He was a union shop steward in the early 1990s but since the end of apartheid in 1994 has worked his way up through the ranks of the ruling African National Congress (ANC), first in local government and then on parliamentary financial committees.

Although there are no doubts about his technical ability, analysts said his lack of political muscle - especially compared to Gordhan and his predecessor Trevor Manuel - could undermine the Treasury's ability to continue to reduce South Africa's budget deficit after a 2009 recession.

"What I question about him is if he can hold his own in terms of policy ideology or if he is it going to be imposed on more by the ANC," said Peter Attard-Montalto, an economist at Nomura in London.

(Reporting by Ed Cropley and Zandi Shabalala; Editing by Alison Williams and Lynne O'Donnell)