ARCHIVE

Nene bungles reaction to recession - David Maynier

DA MP says our finance minister, who was in China, seems to have been caught by surprise by news

Minister of Finance, Nhlanhla Nene, bungled the reaction to the recession in South Africa

The Minister of Finance, Nhlanhla Nene, has bungled the reaction to the recession in South Africa.

The finance minister, who was stranded at the Forum on China-Africa Cooperation in China, seems to have been caught by surprise by the recession, and stated on the sidelines of the forum that:

We didn’t think we would have the second contraction, we were hoping we would have a moderate recovery.”

However, even worse, five days after the news broke that the economy has slipped into recession, the finance minister has still not released a single official statement on the recession.

This is extraordinary, given the fact that immediately communicating the positives in the output numbers, to the extent that they exist, and setting out a recession fighting plan are crucial to maintaining the confidence of the investors, the markets and the rating agencies.

The fact is that government is all over the place when it comes to the recession, with:

President Cyril Ramaphosa saying, “South Africans should not feel despondent, this is not a full-blown recession.”;

Finance minister Nhlanhla Nene saying, “I don’t think people should panic.”; and

Economic development minister Ebrahim Patel blaming the recession on the drought.

Bizarrely, in the end, it was left to the Minister of Communications, Nomvula Mokanyana, the most economically illiterate minister in the cabinet to do damage control and announce that:

The upcoming job and investment summits, as well as the proposed government stimulus package, will provide details on reforms needed to drive growth.”

I will, therefore, write to the Chairperson of the Standing Committee on Finance, Yunus Carrim, requesting him to schedule a meeting to probe the reaction to the recession and the recession fighting plan for South Africa.

Statement issued by David Maynier MP, DA Shadow Minister of Finance, 9 September 2018