South Africa’s finance minister Pravin Gordhan is in the clear. He came out smelling of roses after the country’s chief prosecutor dropped contentious fraud charges against him.
The charges were dropped just days before Gordhan was due to appear in court.
Resultanly, the rand rallied rising 1.3 per cent to 13.6 against the dollar. The currency had plummeted almost 4 per cent when the charges were announced.
The original decision to prosecute Gordhan and his two former colleagues at the South African Revenue Service did not go down well with many South Africans. The move was criticised by civil society groups, opposition leaders, and even senior members of the ruling African National Congress. Over 80 CEOs wrote an open letter in support of the Indian-origin finance minister.
Gordhan had always denied any wrongdoing and described the allegations against him as “political mischief”.
Many suspected the move to prosecute Gordhan was politically motivated by President Jacob Zuma’s intention to take control of the Treasury. There was speculation that Zuma wanted to replace Gordhan with a more pliant finance minister – something repeatedly denied by the President’s Office and the National Director of Public Prosecutions, Shaun Abrahams.
Abrahams wrote to Gordhan’s lawyers on October 31, 2016, saying he would “overrule the decision” to press charges.
“As such, I have directed the summons to be withdrawn with immediate effect,” he told journalists.
The fraud charges pertained to Gordhan approving an early retirement package for his deputy in 2010, when he was head of the South African Revenue Service. Crucial documents emerged last week showing Gordhan was advised that the move was legal.
On Monday Abrahams also said that the approval, even if wrong, “did not show evidence of criminal intent”.
The African National Congress released a statement on October 31 saying it stood behind Gordhan and noted that the fraud case “had a negative impact on the economy”.
Zuma had brought in Gordhan for a second stint as finance minister in December 2015 after he ousted finance minister Nhlanhla Nene, and replaced him with a little known and pliant lawmaker, leading to turmoil in the markets, angering many South Africans.
In a bid to restore calm and steady the plunging rand, Zuma brought back Gordhan to the Treasury and reappointed him as finance minister, a post he held between 2009 and 2014.
Gordhan is against corruption and has come down heavily against the political influence of the Gupta family who are friends with Zuma.
It is alleged that the Guptas have been pulling strings using their friendship with the President to influence political appointments and win state contracts.
At present, Zuma faces nearly 800 counts of corruption, though the National Prosecuting Authority has fought to avoid prosecuting the President in the courts. Zuma denies those allegations.
Meanwhile, the Nelson Mandela Foundation, set up to guard the legacy of Nelson Mandela, has called for a change in political leadership and urged the ruling ANC to “take the steps necessary to ensure that the vehicle of state be protected and placed in safe and capable hands”. The foundation has blamed President Zuma for things going haywire in South Africa. The 74-year-old Zuma has faced calls from several ANC members to quit but is backed by the party's top leaders.
