Economists are divided about how the Finance Minister Nhlanhla Nene‘s scandal will impact his credibility. Nene publicly apologised on Friday after he failed to fully disclose his interactions with the Gupta family.
Nene’s apology comes three weeks before he presents the Medium-Term Budget speech. It also casts a shadow over his political credibility at a time when President Cyril Ramaphosa is demanding ethical leadership.
Economist Chris Gilmour says although Nene has made a big error of judgment, he should not be crucified.
“Many other ministers and indeed many other government officials all around the world have done far, far worse than that. I don’t think the markets will take this too seriously. I honestly believe that the markets have got a lot of faith in Nene. He’s come back from an extremely well-paying job in the private sector with a big financial institution and actually serve the country as Finance Minister. I think most market commentators and observers would give him the benefit of the doubt.”
However, economist Azar Jammine says it would be interesting to know how the ratings agencies would look at the scandal.
” They themselves would be probably torn between trust and mistrust. The fact is that Nene actually stood up to the captures in the final resort of resisting some very potentially disastrous economic deals for the country but the fact that he lied is also not a great message for the ratings agencies.”
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