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South Africa : LESETJA Kganyago selected as new Reserve Bank governor.

Lesetja Kganyago (48) has been selected as the next governor of the South African Reserve Bank after Gill Marcus resignation at the end of her first term as head of the national financial body.

The appointment was declared by President Jacob Zuma at a press briefing. Kganyago s term will start on November 9.

It was in the beginning likely that Kganyago would replace outgoing governor Tito Mboweni in 1999 but the job went instead to Marcus.

Kganyago has been with the bank since May 2011 after heading the national treasury for above 7 years as director general.

Some observers felt he had started to come out as the natural choice, having overseen bank supervision, exchange control regulation and risk and compliance. Kganyago spent several years at the Congress of South African Trade Unions and has worked with Finance Minister Nhlanhla Nene at the treasury.

A previous review by Nomura financial services group of voting by the monetary policy committee showed that Kganyago would most expected not be averse to voting in favour of interest rate hikes if the situation required it, depending on the circumstances.

Both Zuma and Kganygo referred to the constitutional mandate given to the Reserve Bank to protect the value of the currency in the interest of balanced and sustainable growth.

Kganyago s promotion will leave a vacuum in the position of deputy and Zuma said his replacement would be appointed in due course .

Hard act to follow

Zuma highly praised Marcus work over the previous 5 years, saying the Reserve Bank had acted independently, without fear, favour or prejudice and thanked her for her dedication and leadership in a hard economic climate.

Marcus said that it was a hallmark of the depth of the organisation that a successor was chosen from within the bank.

Azar Jammine, chief economist of advisory service Econometrix said, No matter how you look at it, Marcus is going to be a hard act to follow . She had a broad, detailed view and political experience and a history in the struggle against apartheid.

Marcus is a previous deputy finance minister and chair of Absa. She in addition worked under Mboweni at the treasury for 5 years, begining in 1999. She allegedly left because of personality differnces between them.

The new governor among other challenges faces increasing inflation and an economy that looks set to grow at the slowest pace since the 2008 recession.

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Publication:Mena Report
Date:Oct 8, 2014
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