Mboweni star rises as power shifts

Antony Sguazzin
The power dynamics in President Cyril Ramaphosa’s inner circle have shifted, bolstering Finance Minister Tito Mboweni’s influence.

Since his appointment in October 2018, Mboweni, 61, has been fighting an uphill battle against Ramaphosa’s opponents within the African National Congress as he strives to trim expenditure and fix indebted state-owned companies. His efforts have been stymied at times by another of Ramaphosa’s close allies — Public Enterprises Minister Pravin Gordhan.

Now the economy, which was already in its worst state since the 2008 financial crisis, has been hit by the coronavirus pandemic and the loss of SA’s last investment-grade credit rating from Moody’s Investors Service. That’s left Mboweni, a former labour minister who has called for asset sales and an end to bailouts for state companies, in the strongest position he’s been in since returning to the cabinet.

“He is the winner,” said Ralph Mathekga, an analyst and author of books on South African politics.

“Tito Mboweni is on the rise. His case has been made more real.”

Mboweni has pushed through two measures this month that were separately opposed by Gordhan, 71, and Ramaphosa’s other key ally — the labour union movement in which he rose to prominence in the 1980s.

On April 14, National Treasury told South African Airways, which hasn’t made a profit since 2011 and has survived on state bailouts, that no more funding was available. The next day it reneged on a government agreement to raise pay for more than 1,2 million civil servants. Together the actions could save the state tens of billions of rand.

While Mboweni repeatedly called for SAA to be closed or sold, Gordhan argued for the need for a national airline, and placed it in bankruptcy protection (business rescue) in December in a bid to ensure its survival.

In February, Gordhan said it was “imperative” that ways be found to rescue the carrier because closing it would have “disastrous consequences” including job losses, EWN reported. The carrier now plans to lay off its entire workforce. Gordhan’s ministry has protested. — Fin24.com