The Democratic Alliance (DA) welcomes the appointment of Gill Marcus as the new Reserve Bank Governor, to succeed Tito Mboweni from November this year. She has a detailed experience of the banking sector, both as a previous Deputy Reserve Bank Governor and through her work in the private sector. We believe the market will welcome her appointment and has confidence in her ability.

What is of concern, however, is the manner in which Mr Mboweni was replaced. Prior to today's press conference, he made several indications that he would be continuing; indeed, President Jacob Zuma says that Mr Mboweni had accepted a reappointment to the position, but then changed his mind. This seems odd, certainly he has done an excellent job to date, the market has confidence in him and there is no apparent reason for the President to replace him.

The reasons for the Governor's sudden change of heart are not known, but it could well be argued that the President has bowed to pressure of unions and pushed the current Governor out. If that is the case, it is deeply disturbing.

The DA believes Ms Marcus needs to start by expressing a commitment to continuing the prudent monetary policy followed by the Reserve Bank to date, in general, and, specifically, to continuing the policy of inflation targeting, and to keeping inflation within a low band.

Indeed, it is her attitude to this particular policy that will determine her success or failure in this position and - the DA believes - the South African economy more generally.

In the press conference where her appointment was announced by the president, Ms Marcus avoided answering a question on whether or not she would continue to pursue inflation targeting, saying the journalist was on a "fishing expedition". That sort of evasive response, however, is entirely unhelpful and will hopefully not be the kind of attitude to define her term in office.

It is unacceptable that a new Governor should dodge a question fundamental to our economic framework and that is the foundation of our monetary policy: the market needs a clear answer as soon as possible.

The DA takes this opportunity to thank departing Governor Tito Mboweni for his good work as Reserve Bank Governor. We wish him well.

Statement issued by Dion George MP, Democratic Alliance shadow minister of finance, July 19 2009

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