Malusi Gigaba. Picture: BUSINESS DAY
Malusi Gigaba. Picture: BUSINESS DAY

What are the likely consequences of Malusi Gigaba becoming finance minister? The short answer is that it is ill-advised to make preconceived judgments. Gigaba deserves time to outline his programme, set his agenda and define his own path.

SA has a grand tradition of finance ministers who take the portfolio at times of crisis and perform much better than they are given credit for on entry. Yet, only the wilfully blind could argue that Gigaba is not facing an extraordinary challenge, that his record is unblemished or that his position is not compromised from the start.

President Jacob Zuma’s history of Cabinet appointments, it is now plain to see, are broadly underpinned by three main considerations. First, he tends to seek out people who are little known and lightly qualified. The objective, conscious or otherwise, is to hire people who owe their positions not to their expertise or any independent political power base, but to him. They, and he, know they are there for only one reason: his discretion. That helps to make them compliant and malleable.

Second, to the extent that they have a political following, it is much more important that the power base exists within the party than among the public. Hence, for example, Social Development Minister Bathabile Dlamini can bring the country to the edge of a calamitous disaster, potentially weakening the ANC with a core voter constituency, but she escapes the axe in the Midnight Massacre culling of Cabinet ministers because her position as head of the ANC Woman’s League brings with it crucial votes. And third, Zuma tends to seek out people who have a history of compliance and fealty.

Gigaba enters the Treasury with the expectation that he will be a pawn in the president’s game and, to some extent, he would not have got the position unless he had already demonstrated he would be prepared to open the path to the state looting the president appears to condone.

His second problem is that he enters Cabinet at a time in which SA’s politics has fundamentally shifted on its axis. Until now, the ANC has maintained the position that it must speak with a single voice, mainly in order to curb the factionalism that underlies its "broad-church" appeal. That façade has now been shattered. When the deputy president and the secretary-general of the party both openly and publicly disagree with a key presidential decision, the floodgates of dissent are officially open.

The new finance minister also faces a dreadful economic context and a government on the brink of a credit downgrade. The enormous trust the Treasury has built up with international institutions and local taxpayers on the back of some extraordinary people and a remarkable team has been shattered. Business confidence, local and foreign, is enormously fragile, and business has been investing to maintain rather than expand when it has been investing at all.

Gigaba has been the author of some of his problems. It is a great irony that he has been promoted despite spiking tourism following absurd visa requirements he instituted as home affairs minister, while Derek Hanekom, who fought to have the visa requirements relaxed, has been fired. Hanekom’s decision was vindicated by a huge surge in tourism, underlining again that performance is clearly not a criterion for advancement in the Cabinet.

Most importantly, in his first outing as finance minister at the weekend, Gigaba pinned his colours to the mast of "radical economic transformation", promising to end the dominance of "conventional economics". This is very worrying. The problem with defying "conventional economics" is that it tends to defy you back, and the consequences are felt very acutely by ordinary people. And if that happens, they will take their revenge at the ballot box.

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