Business Maverick


The ‘Duke of Magoebaskloof’ steps down, paving the way for Enoch Godongwana to become finance minister

The ‘Duke of Magoebaskloof’ steps down, paving the way for Enoch Godongwana to become finance minister
Former Finance Minister Tito Mboweni. (Photo: Leila Dougan) / Newly appointed Finance Minister Enoch Godongwana. (Photo: Gallo Images / City Press / Leon Sadiki)

Godongwana is currently the board chair of the Development Bank of Southern Africa, a state-owned development finance institution, and was previously the deputy minister of public enterprises.

In a highly anticipated Cabinet reshuffle, President Cyril Ramaphosa announced that the former head of the ANC’s Economic Transformation Committee, Enoch Godongwana, would take over as finance minister, reflecting a desire to maintain broadly the same economic course but with a younger and more vigorous advocate.

Outgoing Finance Minister Tito Mboweni has long sought to stand down, while Ramaphosa broadly maintained the current economic team, many of whom are important and long-standing allies, including Mineral Resources and Energy Minister Gwede Mantashe, Public Enterprises Minister Pravin Gordhan and Minister of Trade, Industry and Competition Ebrahim Patel.

Ramaphosa emphasised the importance of reviving the economy, which has just taken a R50-billion hit in output from the recent street violence and looting, placing 150,000 jobs at risk and leaving many destroyed businesses yet to restart their operations. 

Godongwana is currently the board chair of the Development Bank of Southern Africa, a state-owned development finance institution, and was previously the deputy minister of public enterprises. 

Ramaphosa said he had accepted a “long-standing request” by Mboweni “to be excused from his position as minister of finance”.  

Godongwana is a fresh face in Cabinet but considered an old hand in politics. In the ANC, he has led efforts to draft economic policies of the governing party especially after Ramaphosa was elected as the party’s president in 2017. Godongwana is one of the long-serving members of the ANC’s National Executive Committee.

After Ramaphosa was elected as ANC president, Godongwana was a big backer of the prescribed assets-like policy. He believes that SA’s asset management industry, which includes pension funds, insurers and other investors, is sitting on more than R6-trillion under management. Some of these funds, he once told the Sunday Times, should be lent to the state to fund its infrastructure projects/investments. 

Godongwana has also served in various arms of the state. He served as the first economic affairs and later finance MEC in the Eastern Cape under the late premier Makhenkesi Stofile, and was later appointed as the deputy minister of public enterprises. He is also known in trade union circles. Godongwana was the general secretary of the National Union of Metalworkers of South Africa from 1994 to 1997. He also had a stint as the head of economic policy at labour federation Cosatu. 

Godongwana has big shoes to fill as the new finance minister and head of the National Treasury. 

Mboweni joined the Cabinet in October 2018 after the sudden resignation of Nhlanhla Nene, who admitted to meeting members of the Gupta family. The Gupta family have been accused of high-level corruption, which they have denied. Mboweni has repeated his reluctance to serve as finance minister, expressing his eagerness to retire to his farm in Limpopo. He is colloquially referred to as the “Duke of Magoebaskloof”. 

Mboweni is widely regarded as a trusted hand by the investment community and a voice of reason when it comes to fiscal prudence. He has resisted calls for billions of rands to be thrown to unproductive state-owned entities and to compensate 1.3 million public servants with inflation-busting salary increases. 

About Mboweni’s tenure as finance minister, Ramaphosa said: “he has effectively and ably steered National Treasury through extremely difficult economic times, providing stability and instilling confidence”. 

Godongwana is now tasked with helping South Africa avoid a debt crisis and to help the country recover from being graded as junk status by the three major credit rating agencies. 

Ramaphosa and Mantashe have been on opposite sides when it comes to reforms in the energy sector. In June, when load shedding intensified to Stage 3 and posed more threats to the battered economy, Ramaphosa twisted Mantashe’s arm to lift the threshold for companies to produce their own electricity without a licence to 100MW. Ramaphosa’s move was a surprise move because Mantashe had set the threshold at 35MW. 

Embedded generation — which involves companies producing electricity for their own use or for supply to others — is regarded by energy experts and big business as the quickest way to bring more megawatts into the national grid, helping to ease pressure on Eskom, which provides more than 90% of SA’s energy needs. 

In other areas, Ramaphosa’s announcement was akin to the shuffling of deck chairs. Stella Ndabeni-Abrahams, the former minister of communications and digital technologies, has been moved to the Ministry of Small Business Development. 

Ndabeni-Abrahams is widely regarded as having delayed the implementation of a crucial structural reform proposal identified by Ramaphosa: the release of more radio frequency spectrum. This progress is caught up in legal delays as MTN and Telkom are challenging the auction process of spectrum by the Independent Communications Authority of South Africa, saying it will be unfair to smaller mobile operators. DM/BM


Comments - Please in order to comment.

  • Rg Bolleurs says:

    This bandwidth issue has been going on for years. Looks like it’s got another 100yrs to run

  • Jane Crankshaw says:

    Mr Mboweni will be missed by the 5000 top end taxpayers left in this country. His calm demeanor, positive attitude and happy face kept our faith in the ANC. His aversion to changes to the Constitution and nationalization of The SA Reserve Bank, kept our fiscal reputation as reliable inspite of our “junk” status. I wish him well…..

    • Charles Parr says:

      Agree with you Jane, he provided stability when things were looking chaotic. It is a pity that he wasn’t replaced by Mcebisi Jonas but no doubt that was unacceptable politically.

    • Peter Dexter says:

      Also agree with you Jane. Unless Enoch changes his philosophy significantly I predict the 5,000 top taxpayers will soon become a far smaller number, with other countries benefiting. Unemployment will rise and the ANC will still not grasp the causal link.

  • Stephen T says:

    Trade unions have for many years enjoyed far too much political clout than they deserve. They are often more of a hinderance than a help to our economy. And now we have a former unionist as finance minister who wants to raid our private pensions to prop up bankrupt SOE’s? Very suspicious.

  • Rob Glenister says:

    “… important and long-standing allies, including Mineral Resources and Energy Minister Gwede Mantashe, Public Enterprises Minister Pravin Gordhan and Minister of Trade, Industry and Competition Ebrahim Patel.”
    So who needs friends with these deadwoods behind you.

  • Charles Kieck says:

    Nothing about Godongwana,s ” R120m loan” from a pension fund he and his wife were going to pay back???????
    Same same same. Is there any honesty in the ANC????

  • Caroline White says:

    I am sorry to see Tito Mboweni go – but he deserves his retirement. Many years ago, when I was on the committee writing the Green Paper on Affirmative Action, Tito Mboweni (as Minister of Employment) agreed that women were a disadvantaged category that should benefit from affirmative action – going against the views of others on the committee. He also had a kindly and expansive presence.

  • Andy Miles says:

    A signal of an even more redistribute and social spending agenda/focus , we hope not stealing if that train can indeed be stopped. SA desperately needs economic growth driven by private sector investment and motivated, efficient management. Ideology continues to trump impirical evidence and plain old common sense. Disappointing especially for our youth looking for a better future.

  • Gerrie Pretorius Pretorius says:

    Has this new minister of finance not twice been ‘relieved’ from previous positions due to suspected foul play and/or corruption? No indication that he has been absolved from these accusations? The conclusion must be that Tito held on to the purse strings too tightly and now cr needs someone to fill the feeding trough for the next generation to ‘not be poor’. Just another failed African country. Watch this space ….

    • John Gosling says:

      Actually, Gerrie, he RESIGNED as deputy minister of public enterprises (unheard of in the ANC!) after it emerged that R100m belonging to the SA Clothing and Textile Workers Union was paid to Canyon Springs, partly owned by him and his wife, and then invested in a friend’s company that later went bust! He was found to have been paid R1.5m over 2 years by Canyon Springs but was cleared of criminal liquidation inquiries. In 2017 he reach a settlement with the union and paid back the money – all R1.5m. In the Sunday Times today: “On the civil matter (a civil case brought against him) there was no substantial evidence against me other than the fact that I also benefited in the form of a small amount, which I paid back”. Eye watering! Introduction to our tainted finance minister – enter stage left!

  • Bruce Kokkinn says:

    Any background check on Enoch shows just how bullet proof these politicians are!

  • Robert Morgan says:

    The temerity of this old goat Enoch leaves me breathless. The sheer arrogance of thinking he can just waltz into the top finance job in the country on the back of some of the most cynical behaviour witnessed when he purloined R100m in 2012. I hope that the opposition don’t forget how much of a scurrilous wastrel they are dealing with and give him zero wiggle room.

  • Fanie Rajesh Ngabiso says:

    A thank you! Mr Mboweni from a South African citizen, one who wishes you all the best for your future endeavours.

    Mr Godongwana, you have some big boots to fill and I do hope for the benefit of everyone you have the vision to focus on sound economic policy rather than racial myopy. If you don’t, then you will be ultimately responsible for South Africa’s fiscal failure and further needless suffering for the poor.

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