Why Ramaphosa Needs a Decisive Win in South Africa’s Vote

(Bloomberg) -- South Africa’s national elections on May 8 are critically important to the future of the continent’s most advanced economy. Opinion polls suggest the ruling African National Congress party will likely win enough votes to remain in power, with the makeup of parliament largely unchanged. The crucial metric will be the margin of victory, which could determine whether President Cyril Ramaphosa can deliver on pledges to revive flagging economic growth, bring rampant corruption under control and address a 27 percent unemployment rate.

1. Why does Ramaphosa need a big win?

South Africa’s economy hasn’t grown more than 2 percent annually since 2013. Business confidence is at a two-year low and the rand has slumped almost 19 percent since Ramaphosa took office 14 months ago following the resignation of Jacob Zuma. He has already replaced the management and boards of several state companies implicated in graft, appointed a new chief prosecutor and won pledges of billions of dollars in new investment. Investors want him to deliver on plans to spur growth, provide greater policy certainty and address chronic power shortages. A weak electoral mandate would make it harder to effect deep reforms and could further undermine investor confidence.

2. What else is Ramaphosa promising?

He has pledged to address energy problems by breaking up the debt-ridden state utility that supplies 95 percent of the country’s electricity to make it more efficient. He also vows to cut red tape to win South Africa a top-50 position in the World Bank’s ease of doing business ranking within three years (it currently ranks 82nd out of 190 nations). And he aims to boost tourism -- attracting 21 million visitors by 2030, up from 10 million last year -- by loosening visa rules. Ramaphosa’s most contentious proposal is to make it easier for the government to seize land without paying for it, a move he says is necessary to address racially skewed ownership patterns dating back to colonial and apartheid rule.

3. What would a narrow win mean?

The 66-year-old president, a lawyer, former labor union leader and multi-millionaire, gained control of the ANC in December 2017 by a razor-thin margin. The party, which led the fight against apartheid and took power under Nelson Mandela in the nation’s first multiracial elections in 1994, has been struggling to rebuild its reputation in the wake of Zuma’s scandal-tainted rule. Some officials loyal to Zuma still hold top party posts and have undermined the new president’s leadership and anti-corruption drive. A poor showing for the ANC at the ballot box could embolden internal rivals to try to topple Ramaphosa at the party’s next elective conference in 2022 -- if not sooner.

4. How about competing parties?

South Africa’s main opposition, the center-right Democratic Alliance, has scored gains in recent municipal elections. But there are rumblings of divisions in its ranks over issues such as immigration policy and black economic empowerment. A poor national result -- for instance, a sharp drop in popular support below the 22 percent the DA won in 2014 -- could hasten a split and threaten the tenure of party leader Mmusi Maimane. By contrast, Julius Malema, head of the leftist Economic Freedom Fighters, South Africa’s No. 3 party, is scoring points among unemployed black youths with his calls to nationalize mines, banks and land.

5. How does the election work?

Forty-eight parties are competing for 400 seats in the National Assembly, which, in turn, elects the president. He appoints the cabinet. Political control of the government brings with it the power to dispense the $126 billion national budget. There will be concurrent elections for South Africa’s nine provincial legislatures, each of which appoints a premier who heads an executive committee overseeing provision of schooling, health care and other services.

6. What the polls saying?

Estimates of support for the ANC range from 51 percent to 61 percent in surveys by polling firms and research institutes. The DA is polling from 19 percent to 24 percent, and the EFF 11 percent to 14 percent in the latest studies.

7. How credible will the election be?

The Independent Electoral Commission has a good track record of conducting honest and transparent elections that have been largely free of the violence seen in some other African nations. There have been several politically motivated killings in the run-up to the vote, however, and rival parties have accused each other of defacing election posters and other unfair campaign tactics. Even so, the outcome is likely to be widely accepted.

The Reference Shelf

• A QuickTake on the challenges confronting South Africa.
• Who is Cyril Ramaphosa and can he stay in charge of the ANC?
• A Bloomberg story on South Africa’s decline over the past 12 years.
• The Independent Electoral Commission’s website.

To contact the reporter on this story: Mike Cohen in Cape Town at mcohen21@bloomberg.net

To contact the editors responsible for this story: Karl Maier at kmaier2@bloomberg.net, Andy Reinhardt, Gordon Bell

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