Gordhan was quoted on Monday as saying that the Cabinet had decided that there would be “a formal procurement process, in accordance with South African law”, but that the procurement had to be affordable.
Opposition to the potentially costly nuclear deal, frequently billed as one of Zuma’s pet projects, is widely held to be one of the reasons for Nene’s firing.
In his first speech since being re-appointed to the position he held from 2009-2014, Gordhan also reiterated the sanctity of the Treasury’s expenditure ceilings. Some analysts are having difficulty seeing how these two ideas can work in tandem.
Peter Worthington, principal and senior economist at Barclays Africa, said on Tuesday: “We think it is hard to reconcile the two objectives: fiscal consolidation with adherence to the tight expenditure ceilings, and a drive to procure nuclear power, since most of the costs of nuclear power are incurred up front.”
