Kea' Modimoeng

Kea' Modimoeng

Markets failed yesterday to respond even politely to news that corruption charges against ANC president Jacob Zuma were being dropped.

Analysts said this was a sign that investors were "accepting Zuma".

The rand was steady at midday after acting national director of public prosecutions Mokotedi Mpshe made the announcement that the charges were being dropped over collusion allegations. It traded at about R9 to the dollar after closing at R9,03 on Friday.

The South African Chamber of Commerce and Industry said that although it did not have a problem with the NPA's decision in itself, it was not fully satisfied with the "process" on which the decision was based.

Its chief executive, Neren Rau, said: "We are not concerned with the outcome per se, or with whom it should favour.

"What we are concerned with is the need for clear pointers which led to the decision and not necessarily telephonic conversations."

Rau said failure to bring clarity on how the issue was tackled was not good for South Africa as an investment destination and not good for the future president "whoever it will be".

David Shapiro, Sasfin economist and market commentator, said: "The fact that the rand remained strong is an indication that the decision didn't affect the markets.

"It shows that the investors are accepting Zuma and that he will be the president."

T-sec economist Mike Schüssler said it was not surprising that the decision did not affect the markets.

"I don't think this is a market-moving decision," he said.

Dawie Roodt, economist at the Efficient Group, said the markets were probably prepared for such a decision.

He noted that the issue which might be of great concern was the independence of the judiciary.

"There is a bad smell about the whole thing.

"The right thing for a politician to do is to step down in the interests of the country's well-being," said Roodt.

Since Zuma's election as ANC president at the party's national conference in Polokwane in December 2007, there has been talk that the election of a state president who had corruption charges hanging over his head would have a negative effect on the economy.