The president says closing SAA would de-stabilise the entire economy, and the DA now wants to know if the finance minister is a ‘lame duck’

President Cyril Ramaphosa has sided with public enterprises minister Pravin Gordhan on the future of SAA, rejecting finance minister Tito Mboweni’s contention that it should rather be cut loose.

Just a day after Gordhan signalled that his preference was to nurse the airline back to health, Ramaphosa told parliament on Tuesday that closing it down would destabilise other state-owned entities (SOEs) and the broader economy.

If you are already a subscriber, please click on the following link to go to the full article: Ramaphosa: there is no plan to sell SAA.

Answering questions from MPs in the National Assembly, Ramaphosa said there was no plan to close down SAA, as Mboweni had suggested, and that doing so would de-stabilise other state-owned enterprises (SOEs).

“The effect of the ‘smack down’ was to cast the finance minister as a likable old man, who says what he thinks, but who is on the fringes of power, and who has very little, or no, influence on economic policy,” DA finance spokesperson David Maynier said in a statement.

“The real question now is whether Tito Mboweni is a ‘lame duck’  finance minister who will serve as a placeholder until the general election, and will then be forced back into political exile.’’

Mboweni’s call for the disbanding of the airline was made at an investor conference in New York on Thursday. “It’s loss-making. We are unlikely to sort out the situation, so my view would be close it down,” he told delegates.

Ramaphosa said on Tuesday, just a day after public enterprises minister Pravin Gordhan signaled that his preference was to nurse the airline back to health, that closing SAA down would de-stabilise the broader economy.

“You would have to pay someone to take SAA out of your hands,” Ramaphosa said. ‘‘If we say ‘shut it down, it means that the debt SAA carries becomes payable immediately.”

Maynier said he will submit a parliamentary question on whether Ramaphosa still has confidence in his new finance minister, ‘‘despite his heretical views on how to deal with zombie SOEs, like SAA’’.

“There are clearly deep divisions within the government, and within the governing party, on how to fix the economy, which explains why there are 9.75-million people who do not have jobs, or who have given up looking for jobs, in SA.”

Loading...