Experts: Why Tito is the total package
He will have a lot on his plate but he has the experience and the gravitas to deliver, they say
Economists on Tuesday welcomed the appointment of former Reserve Bank governor Tito Mboweni as the country’s new finance minister.
President Cyril Ramaphosa announced Mboweni’s appointment on Tuesday just moments after telling the nation he had accepted former finance minister Nhlanhla Nene’s resignation.
Nene offered his resignation after admitting during the commission of inquiry into state capture that he had met in private, on several occasions, the Gupta family.
Economist Roelof Botha said Mboweni’s appointment was good news.
“Being governor of the Reserve Bank, and having spent a number of years in the private sector rubbing shoulders with some of the country and world’s top private business individuals, bankers and analysts, means he comes with a wealth of experience. Mboweni understands economics.”
He said Mboweni had everything going for him in terms of political credentials and enjoyed huge support within the enlightened faction of the ANC.
“With the right people he will be a good step to turning around the economy, especially with the important respect that he has for free-market principles.”
Economist Mike Schussler said Mboweni was a safe choice, “given how empty the cupboard is when it comes to senior and experienced people”.
“He is high up in the ANC hierarchy and comes with a wealth of experience. It makes a great deal of sense to appoint Mboweni, especially with the ratings agencies, which need to be smoothed over and placated.”
He said his seniority within the ANC meant he could easily say no to state-owned entities that came knocking on doors for more money.
“Mboweni has the gravitas to win those kinds of fights. When you read Denel cannot afford toilet paper and when you decide that you will not save it, Mboweni is the type of person you want who can say no to it or other state-owned entities.”
Mboweni, who was sworn in on Tuesday, became the sixth finance minister in the last five years after Nene resigned following a controversy over his apology for multiple meetings with the Gupta family at their private home in Saxonwold and at their offices.
Nene made the apology after detailing his meetings with the Guptas at the state capture commission of inquiry last week, which until then had remained secret.
Nene also came under pressure to step down after it emerged that his son may have derived financial benefit from the Public Investment Corporation (PIC) at a time when he was deputy finance minister.
Public protector Busisiwe Mkhwebane is now investigating him for possible breach of the Executives Ethics Act following a complaint from the DA.
Mboweni has previously served as minister of labour under late former president Nelson Mandela between 1994 and 1999 before spending 10 years as the governor of the Reserve Bank between 1999 and 2009.
He has also served international adviser of Goldman Sachs international and on the board of Anglo Gold Ashanti, among other positions in the private sector.
Mboweni’s immediate big task is the delivery of the Medium Term Budget Policy Statement in the next two weeks amid a gloomy economic outlook.
Ramaphosa said Nene wrote to him on Tuesday, requesting that he step down.
“He has indicated that there is risk that the developments around his testimony will detract from the important task of serving the people of South Africa, particularly as we work to reestablish public trust in government.
“After due consideration of the evidence presented by minister Nene at the commission, and in the interests of good governance, I have decided to accept his resignation.
“During his tenure as minister of finance, Mr Nene served the people and government of South Africa with diligence and ability.
“Under difficult circumstances and often under great pressure, he consistently defended the cause of proper financial management and clean governance.
“It is a measure of his character and his commitment to the national interest that he has taken this decision to resign in the wake of errors of judgment, even though he has not been implicated in acts of wrongdoing.
“I wish to take this opportunity to thank him for his service to the nation.”
Turning to Mboweni, Ramaphosa said he came in at a time when “strong and capable” leadership was required to transform and rescue the ailing economy.
Ramaphosa also said nobody was above the scrutiny of the state capture commission of inquiry.
“It is critical that the commission has the means and opportunity to effectively fulfil its mandate.
“In this process, no person should be above scrutiny, and all relevant and credible accusations of wrongdoing should be thoroughly investigated.
“It is incumbent upon any person who may have knowledge of any of the matters within the commission’s mandate to provide that information to the commission, to do so honestly and to do so fully.”
The president appoints ministers from among members of the National Assembly in terms of section 91 of the Constitution, but it also allows him to appoint no more than two ministers from outside parliament.
Mboweni, along with Mineral Resources Minister Gwede Mantashe, has been appointed under this arrangement because they are not MPs.