Economist, Cees Bruggemans has offered a glimpse into the future of South Africa, after President Jacob Zuma announced the removal of Finance Minister, Nhlanhla Nene, on Wednesday.<\/p>\n
“It just goes to show that apparently anyone can be finance minister,” said Bruggemans, of Bruggemans & Associates, Consulting Economists.<\/p>\n
Nene\u2019s replacement is ANC member of parliament, David Van Rooyen.<\/p>\n
Van Rooyen is the whip of the standing committee on finance and whip of the economic transformation cluster.<\/p>\n
He is a former executive mayor of Merafong Municipality and a former North West provincial chairperson of the South African Local Government Association.<\/p>\n
“Swimming naked has suddenly acquired a new meaning as SA got a new finance minister ready to do his master\u2019s bidding\u00a0–\u00a0which is to approve trillion rand nuclear deals and other assorted schemes favouring dubious supporters,” Bruggemans said in a brief note on Thursday.<\/p>\n
“SA can ready itself for unrestrained tax increases, and state spending projects that will drain its citizens for decades to come as favoured presidential schemes are nodded through.”<\/p>\n
The economist said that global markets would not be amused with events, ‘which spells junk status’.<\/p>\n
“As global capital rejigs its portfolio weighing, the SA bond market, JSE equity market and SA rand will be the main barometers of such judicious reconfiguring,” Bruggemans said.<\/p>\n
“It makes any rand forecasting a standard joke, for the infinity symbol is the only appropriate one to use.”<\/p>\n
“The dam wall has given way. Stand back while the world sits in judgement. It will take a while to embody this in new values, for which reason putting any numbers to paper at this early stage is premature.”<\/p>\n
The economist said that South Africans should accept that:<\/p>\n
“Clearly, events yesterday have overtaken all else. So whatever else I had written, waiting in the pipeline to be published \u2013 forget it. We are in a new era,” he said.<\/p>\n
“We may call the New Year, in good Chinese tradition which will become the new norm for us, no doubt, the Year of the Zuma Poodle. A more appropriate moniker for the national currency I cannot imagine,” Bruggemans said.<\/p>\n
“So, the Poodle is expected to quickly reach for 20:$ and 21:\u20ac in 2016. It should imply a CPI inflation surge closer to 7%.”<\/p>\n
What SARB will do to neutralise such surging remains to be seen,\u00a0Bruggemans\u00a0 said, noting that if Treasury can fall, so can others.<\/p>\n
“Your petrol\/diesel costs – and imported food for the poor – are about to seriously rise even before the new finance minister gets to you in the New Year. Seriously depressing for real spending, output and income in the economy.<\/p>\n
“And for business confidence as all plans get rejigged. Also for labour peace as inflation compensation demands will be upped.<\/p>\n
“One can hear the presidential chuckling as these events unfold,” Bruggemans said.<\/p>\n
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