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World

South Africa finmin fraud charges fuel suspicion

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World

South Africa finmin fraud charges fuel suspicion

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COMING UP:South Africa finmin fraud charges fuel suspicion

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00:00:00
>> Fraud charges laid against South Africa's finance minister will be hard to prove and will fuel suspicions of a plot by President Zuma to oust him, according to legal experts and senior politicians. Pravin Gordhan is regarded by many as a reliable figure, but he'll now have to appear in court in November on charges he denies.
00:00:19
Reuters' Joe Brock is in Johannesburg.>> The perceived power struggle between Zuma and Gordhan has been a problem for markets for quite some time. They see any attempt to remove Gordhan raising the possibility of increased public spending. This puts pressure on debt levels and, indeed, the currency.>> The news on Tuesday did indeed send the rand and share prices tumbling, creating fears that the legal troubles could damage investor confidence in the country, as ratings agencies are on the verge of downgrading South Africa's status to junk.
00:00:51
The prosecutor says Gordhan approved early retirement for a deputy commissioner of the tax agency in 2010, and rehired him as a consultant at a cost of about 80,000 pounds. But legal experts say it'll be difficult to produce concrete evidence that he broke the law.>> Publicly, Zuma has backed Gordhan, and says he's innocent until proven guilty.
00:01:12
But behind closed doors it's a different story. What insiders in the NC tell us is that Gordhan has become a nuisance to Zuma, and he would like him removed, but he needs to find a clear, legal pathway in order to do that.>> Gordhan has urged fiscal prudence, while the ruling party's former treasury general says Zuma's camp want to push through expensive projects.
00:01:33
He adds that new financial minister may therefore be more pliable.