Economists speak out on SA vote of no confidence

09 Aug 2017 19:30pm
WINDHOEK, 09 AUG (NAMPA) – The political situation in South Africa (SA) after President Jacob Zuma narrowly escaped a vote of no confidence on Tuesday was received with mixed feelings by local economists.
Namibian independent economist and Managing Director of Twilight Capital Consulting, Mally Likukela speaking to Nampa immediately after SA’s National Assembly speaker Baleka Mbete announced the results, said the outcome of the vote will be immaterial for both Namibia and SA.
The African National Congress (ANC) garnered 198 votes to 177 and nine abstentions for President Zuma to stay in office.
“The market has already adjusted and learnt how to operate in an uncertain economic environment for a long time,” said Likukela.
But economist from Simonis Storm Securities, Frans Uusiku said the motion’s defeat and President Zuma’s continued stay as head of State will have a negative impact, as investors look at various indicators such as a country’s political stability, which is currently in chaos in SA.
“The Rand has already deteriorated with one per cent to the US dollar because of the current unstable politics,” said Uusiku.
An economist at Capricorn Asset Management, Claudia Boamah argued that most ruling party members failed to distinguish between voting no confidence against the president and voting no confidence against the ANC.
Boamah said some MPs voted to protect their own jobs and not the best interest of the country.
“On Tuesday the Rand lost 1.2 per cent in value, the deepest plunge among major global currencies,” she warned.
She further said that the ANC might have won this battle, but in so doing they might have compromised their victory in 2019.
The eighth no confidence motion was brought by the Democratic Alliance, the largest opposition party, in response to a Cabinet reshuffle in March in which Zuma dismissed Finance Minister Pravin Gordhan.
President Zuma is also accused of corruption, poor governance and a sinking economy.