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Tito Mboweni is being seen as the comeback kid in South Africa [Courtesy: Ministry of Finance]
But two decades later, they greeted his appointment as Minister of Finance with glee, resulting in the rand gaining more than 30 cents against the US dollar this week.
The reason for this reaction was that this time Mboweni was seen as a seasoned financial markets player, whereas in 1998 he was seen as a novice, even though he held a cabinet position as Minister of Labour in Nelson Mandela’s first African National Congress (ANC) cabinet from 1994 to 1998.
He first joined the SARB in July 1998 as adviser to then Governor Chris Stals and had his baptism of fire the following month, when the Russian debt default froze up South Africa’s financial markets with bond market makers unable to set prices for the one (and hopefully only) time since they had been appointed.
It was under Mboweni with the concurrence of the other two members of the TM Triumvirate (the others being Thabo Mbeki and Trevor Manuel) that the South African government introduced the inflation targeting regime, which has proven to be a solid anchor for monetary policy.
This move was hailed by economists who said that it would bring about stability, although detractors from organized labour and business criticized the target range as being too tight and said it would stifle economic growth and job creation.
Many now believe that President Cyril Ramaphosa has made an inspired choice and the markets are justified in their optimism as Mboweni will bring some much needed stability to his new position of Minister of Finance.
Helmo Preuss in Nusa Dua, Bali at the International Monetary Fund meetings
