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South African finance minister Pravin Gordhan. Credit: GCIS

Gordhan will appear in court on 2 November in connection with allegations of misconduct, stretching back to his time in charge of the country’s tax agency a decade ago. Many believe the nation’s president Jacob Zuma would like to oust Gordhan.

The news knocked investor confidence, as Gordhan, a widely trusted and respected figure, becomes further drawn in to the political turmoil and corruption scandals dogging the rest of the South African government.  

The rand dropped 3.4% against the dollar and share prices reeled when prosecutors announced they would summon Gordhan yesterday.

Gordhan, who has held his post since December 2015, has argued that he is a victim of “political mischief” and that the charges are baseless.

 The accusations relate to his alleged approval of generous severance packages for a former senior official in the South African Revenue Service and the head of the National Prosecuting Authority.

A former SARS commissioner and deputy commissioner have also been summoned to appear in court on the same day.

He is also being investigated over the establishment of a surveillance department within the revenue office, which is suspected to have gone beyond its mandate to collect unpaid taxes.

Since taking office, Gordhan’s relationship with Zuma and his allies in the nation’s governing party, the African National Congress, has been tense.

Issues relating to the public finances and the management of state-owned enterprises, anti-corruption agencies and the central bank have all sparked infighting.

Zuma only reluctantly appointed Gordhan last year, after his first choice sent the rand to record lows and triggered a collapse in stock markets. Zuma has denied there is a rift between the two.

Prosecutor Shaun Abrahams has also rejected the notion there was political interference in his department’s decision to summon Gordhan.

But a statement from Gordhan’s office said: “It is quite clear that these legal proceedings are contaminated by abuse for political ends.”

It added that the decision also endangers South Africa’s economic well-being, a charge supported by opposition groups and seemingly borne out by the economic consequences of the announcement so far.

Gordhan became South Africa’s third finance minister in one week in December last year, after Zuma sacked the incumbent Nhlanhla Nene and replaced him with David van Rooyen – a widely criticised decision that sent the rand and stocks reeling.

Gordhan was then appointed in his place to calm faltering markets and restore confidence. His efforts to control government spending in the following months built up trust with investors, and he became seen as a reliable figure amid a chaotic political environment. 

The news comes at an inconvenient time for Gordhan, who spent the last week at the International Monetary Fund annual meetings in Washington attempting to woo investors and foreign politicians with the idea South Africa was starting to turn itself around. 

A statement released by Zuma today voiced support for Gordham, and said the announcement comes at a very "sensitive" time for the country, when he was successfully leading initiatives towards economic revival. 

Gordham is "innocent until and unless proven otherwise by a court of law", Zuma stressed.