South Africa’s new finance minister Tito Mboweni will be a substantial boost for both domestic and international business confidence in SA.
That’s according to Joff van Reenen, commenting wearing the dual hats of PR director of for the South African Institute of Auctioneers (SAIA) and lead auctioneer and director of the country’s premier property auction house, High Street Auctions.
Mboweni was appointed in October just hours after the resignation of Nhlanhla Nene, who stepped down following testimony before the state capture inquiry that he had met with members of the Gupta family several times between 2009 and 2014.
“Both local and international business is likely to be almost as accepting of the new finance minister as they were of the rock steady Pravin Gordhan. “Mboweni has a fine reputation internationally, not least of all from his decade long tenure as governor of the Reserve Bank.
“The minister has a substantial track record in government, he has demonstrated knowledge and skill in matters of labour relations and his approach to policy has been balanced and fair.”
Van Reenen says the composition of the Cabinet isn’t yet a “dream team” and there is significant ground to cover to re-establish international investor confidence in SA after the rather sordid details of the attempted state capture came to light.
“Having Mboweni in the finance hot seat and Gordhan at the helm of state enterprises will go a long way though towards calming jitters over the next few months and turning off the floodgates of capital outflow.
“The markets were naturally been turbulent on the back of, among others, the finance portfolio change and the US interest rate increase but there’s no doubt we’ll see the rand’s performance improving in fairly short order and after that a turn around in long term foreign business investment.
“The auction industry leads a fairly charmed life in that it is by and large less affected by overt changes in business sentiment either way because our services are equally in demand in prosperous and tumultuous periods, but we certainly won’t complain about more money coming into circulation.
“This is equally true for the property industry, because capital inflow promotes business growth and therefore fuels the necessary associated infrastructure demands such as commercial and industrial property.”
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