South Africa’s Zuma could face early exit

Significance The news prompted a sharp drop in the value of the rand, its largest one-week fall against the dollar since 2015 and the previous sacking of a finance minister. Zuma’s decision came against the wishes of many within the ANC and its alliance partners and prompted opposition parties to propose a parliamentary motion of no confidence in the president. Impacts Anti-Zuma protests could bring rival trade union organisations closer together. Poor relations between the ANC and the South African Communist Party (SACP) will worsen ahead of policy and elective conferences. The Economic Freedom Fighters (EFF) will benefit most from the current crisis, as the Democratic Alliance (DA) struggles with infighting.

Significance The re-opening comes despite an infection rate that is expected to peak only later this year. Impacts The Economic Freedom Fighters and ANC-aligned populists will try to make political capital out of increasing infection and death rates. The government’s failure to deliver promised COVID-19 relief quickly and effectively has thrown fresh light on poor state capacity. Allowing church and other religious services to re-open has raised renewed questions over the coherence of Pretoria’s regulations.


Significance His comments come amid lingering concern over parliament’s endorsement last month of land expropriation without compensation. The contested policy was proposed by the leftist Economic Freedom Fighters (EFF) and backed by the ruling ANC, but the main opposition Democratic Alliance (DA) argues that such a policy will jeopardise property rights and lead to capital flight. Impacts Improving national land and agricultural data collection will prove crucial to substantive land reform. Attempts to overhaul land reform policy could see a deterioration in relations between the government and traditional leaders. Political violence in flashpoints such as KwaZulu-Natal province could worsen ahead of the 2019 poll.


Significance However, cuts to the social grants budget and a continued focus on the planned three-year wage freeze for civil servants has annoyed (among others) the ruling ANC's ‘Tripartite Alliance’ partners, the Congress of South African Trade Unions (COSATU) and the South African Communist Party (SACP). Impacts Pressure will grow on a joint National Treasury-Presidency initiative, ‘Operation Vulindlela’, to hasten long-promised structural reforms. The success of the government’s mass vaccination programme will depend on its efficacy and willingness to work with the private sector. The government's modest economic recovery projections could prove too optimistic if vaccine roll-out falters or further COVID-19 waves hit.


Significance Earlier this month, the South African Council of Churches (SACC) and the Public Affairs Research Institute (PARI) released separate reports alleging a corrosive process of ‘state capture’ by influential business figures. Meanwhile, officials in the ANC’s alliance partners -- the South African Communist Party (SACP) and the Congress of South African Trade Unions (COSATU) -- are openly calling for Zuma's resignation. Impacts If Nkosazana Dlamini-Zuma triumphs in the ANC's leadership contest, COSATU could withhold support for the party at the 2019 elections. Support for both the Democratic Alliance and the Economic Freedom Fighters will increase and hasten formal national coalition talks. The nascent left-wing United Front movement could draw support from the ANC if a coalition with new trade union SAFTU is formalised. Racial polarisation could worsen as ANC populists blame 'white monopoly capital' and 'foreign agents' for government failings.


Significance Although this was above market expectations and the economy has avoided entering a technical recession, fears persist over the slow pace of reforms by President Cyril Ramaphosa’s administration. Promised details on the overhaul of state-owned power utility Eskom have yet to be unveiled, and a new growth strategy released by Finance Minister Tito Mboweni has been pilloried by the ruling ANC’s Alliance partners, the Congress of South African Trade Unions (COSATU) and the South African Communist Party (SACP). Impacts Part of the opposition to the new document reflects longstanding ANC divisions and labour unease with Mboweni, a more pro-market figure. Despite recent chatter, Pretoria is a long way off the kind of balance of payments crisis that would likely necessitate a turn to the IMF. Business confidence and private-sector investment will likely remain weak until there is clear evidence of a commitment to implement reform.


2021 ◽  
Vol 11 (4) ◽  
pp. 1-15
Author(s):  
Marianne Matthee ◽  
Albert Wöcke

Subject area Macro-Economics. Study level/applicability Undergraduate and MBA. Case overview The COVID 19 pandemic-related restrictions devastated South Africa’s economy in 2020 and although the restrictions were generally less damaging than in 2020, the government had to budget for vaccinations and rebuild the economy. Public service unions had just announced that they were demanding an increase of 4% above inflation for their members and that they were preparing for a strike. They were bitter about the fact that the South African Government had withdrawn from the last year of a three-year wage agreement in February 2020 and their members had not received an increase for the two years. These demands and Finance Minister Mboweni’s response to them had to consider the structural and cyclical impact on the fiscus and economy. Expected learning outcomes The learning outcomes are as follows: understand the general objectives of fiscal policy and stakeholders’ interests; understand the tradeoffs in fiscal policy and the implications of taking a position; and make recommendations based on reasoned judgements about those recommendations. Complexity academic level Undergraduate and MBA level courses on Macro Economics. Supplementary materials Teaching notes are available for educators only. Subject code CSS 10: Public Sector Management.


2020 ◽  
Vol 38 (2) ◽  
Author(s):  
Henning Melber

South African Finance Ministers (notably in the plural, given the events since December 2015) face multiple challenges. They deal not only with an economy in stagnation through an austerity policy as recently presented by Pravin Gordhan in his Medium Term Budget in late  October, but also with the sobering results of the limited socio-economic transformation since the end of apartheid. The contradictions prevailing since then are reflected not least in the devastating crisis sweeping across South Africa  universities. As if that is not enough, a Finance Minister concerned about good governance is also waging an uphill battle to reduce damage by trying to protect the state and its assets from further capture by predatory elites. Considering all of this, it is not surprising that a critical analysis of what is termed economic freedom, an interpretation of the meaning and its consequences, is a fitting contribution to the Strategic Review. Joleen Steyn Kotze presents such an examination in the first article of this issue. Her reflections compare and juxtapose the different notions and ideologies of economic freedom and the effects these may have if turned into policy. This invites further debate regarding the transformation of South African society, which inherited one of the most grossly unequal societies in our world, a condition yet to be markedly reduced. Debates are also required about other aspects that are relevant for a journal focused on regional strategic issues. These include not least the notion of human security and the role of the military. Thuso Benton Mongwaketse relates directly with his contribution, to a subject raised in recent issues.1) By concluding that "security and human security in particular, is fundamentally about responsiveness, accountability, and transparency in governance", he more than indirectly links the discourse on the role of a national defence force to the socio-economic dimensions dealt with in the first article.


2021 ◽  
Vol 59 (4) ◽  
pp. 535-558
Author(s):  
Marine Fölscher ◽  
Nicola de Jager ◽  
Robert Nyenhuis

ABSTRACTThis article examines the use of populist discourse in South African politics. We investigate speeches of leaders from the ruling African National Congress (ANC) and opposition parties, the Democratic Alliance (DA) and the Economic Freedom Fighters (EFF). We find that the EFF consistently employs populist appeals, while both the incumbent ANC and official opposition DA largely refrain. Our longitudinal analysis allows an examination of fluctuation across party leaders and electoral cycles, and illustrates that neither the ANC nor the DA have modified their political discourses in light of a rising populist challenger. However, there is some evidence that the two most dominant parties have reformed their programmatic offerings and behaviour in an attempt to compete with the EFF's popular appeal. The South African case offers important insights into the study of oppositional populism on the African continent, and a window into how major political parties may respond to emerging populist contenders.


Significance Outgoing leader, Helen Zille, resigned on April 12 -- two years earlier than expected. Party strategists see Maimane as critical for attracting black voters, whose support is essential for its growth. Impacts The radical left-wing Economic Freedom Fighters' appeal among young, educated black voters may dilute the DA's attraction strategies. The DA will struggle to transform its Values Charter into specific policy proposals, due to the departure of senior policy figures. Consequently, DA-controlled sub-national governments will formulate their own policies, tailoring them to appeal to local constituencies. Its media team will struggle to communicate with the ANC's rural supporters, who are often influenced by traditional leaders.


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