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19 Jul 2009 07:39
President Jacob Zuma does not plan to appoint Reserve Bank governor Tito Mboweni for another five-year term, and wants to replace him with his former deputy, Gill Marcus, the Mail & Guardian can confirm.
With just three weeks until the end of Mboweni’s five-year contract there appears to be confusion in the presidency, however, over how to handle the succession, and to deal with potential market fallout from a hasty announcement.
Most economists had speculated that he would keep the job, and as recently as Thursday a senior Luthuli House official close to Zuma told the M&G that Mboweni would stay on despite pressure for Zuma’s leftist allies for his ouster.
Mboweni himself on Saturday effectively confirmed that he will be departing.
Asked about the prediction in Friday’s edition of the M&G that he was “set to stay”, Mboweni said simply: “you got it dead wrong”.
Mboweni was told just last Saturday that he would not keep his job, a senior state official familiar with discussion told the M&G, confirming that Marcus had been selected to replace him.
“The trouble”, this person said “is that now it is going to look like Tito was fired”.
Marcus is well regarded by investors, having spent several years chairing the board of banking giant Absa, and it is not her selection, so much as the apparent mismanagement and unpredictability of the process that is likely to rattle markets.
One plan under discussion in the presidency is to limit the damage by reappointing Mboweni on the understanding that he will step down after six months.
That would allow for time to prepare the ground, officials hope, but it does leave open the possibility, however slender, that when the time came he would decline to quit, leaving Zuma with an enormous political and economic headache.
“It is really up to Zuma” said an official of whether Mboweni would leave now or early next year, but neither solution is likely to foster confidence in the new president’s stewardship of the economy.
“Absa is not in a position to comment,” Happy Ntshingila, executive director for group marketing and corporate affairs, told the M&G on Sunday morning.
Zuma is expected to make the announcement at a press conference at the Union Buildings in Pretoria at noon on Sunday.
Zuma’s office called the press conference an hour after the M&G Online reported that Mboweni had confirmed that he would not be staying on.
Officials would not confirm for the record that the conference had been called to deal with the Reserve Bank succession, but the M&G has established that it is being held to spike potentially confidence sapping rumours before markets re-open on Monday.
Nic Dawes is the Mail & Guardian's editor-in-chief.
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