Jacob Zuma appoints South Africa’s first black finance minister
First black finance chief for South Africa is part of drive for social transformation
South African President Jacob Zuma has tapped junior minister Nhlanhla Nene to become the country's first black finance minister as he unveiled his new cabinet a day after taking office.
The appointment of Nene, 55, represents a statement of intent from Zuma, who has vowed to bring radical social and economic transformation in his second five-year term.
Within South Africa's ruling ANC there is a strong desire to put more economic power in black hands. In the 20 years since South Africa struggled free from racist apartheid rule, the economy remains predominantly in white hands, despite a raft of empowerment programmes.
"Economic transformation will take centre stage during this new term of government as we put the economy on an inclusive growth path," Zuma said at his inauguration on Saturday.
Nene had served as deputy to internationally respected finance chief Pravin Gordhan, who is of Indian origin.
"Nene is an old hand at the treasury," said Razia Khan, Africa's regional head of research for Standard Chartered Bank. "He will be seen to represent policy continuity."
But his appointment is not without risk. The rand has been under pressure for months and ratings agencies have warned that deficits, high unemployment and slow growth may prompt a further credit downgrade to junk bond status.
That could raise the cost of borrowing for the South African government and prompt international investors to look to other faster-growing emerging markets in Africa.
Some analysts also believe the country will report negative growth in the first quarter later this week.
"Progress made in lifting growth, and fulfilling previous fiscal consolidation pledges, will be closely watched," said Khan.
Nene is a former parliamentarian and chairman of the finance portfolio committee. He spent 15 years at insurance firm MetLife, where he was a regional administrative manager and where, during apartheid, he organised the country's first strike in the financial sector.
He does not have a high public profile, being best known previously for tumbling off a broken chair during a television interview in 2008.