Magazine article African Business

Zuma's Survival Keeps South Africa on the Edge: South Africa's Struggling Economy Continues to Attract the Attention of Ratings Agencies, but the President's Position Looks Strong for Now

Magazine article African Business

Zuma's Survival Keeps South Africa on the Edge: South Africa's Struggling Economy Continues to Attract the Attention of Ratings Agencies, but the President's Position Looks Strong for Now

Article excerpt

In early December, just a day after receiving the welcome news that South Africa would be spared a downgrade to junk status by S&P Global Ratings, President Jacob Zuma's office dispatched a triumphant statement to the international press corps.

Congratulating "Team South Africa" on the reprieve, Zuma argued that the collective exertions of government, business and labour had helped the country overcome a "very volatile global economic climate."

After a nightmare year featuring repeated corruption scandals, a legal battle waged against finance minister Pravin Gordhan, and an economy permanently teetering on the brink of recession, few members of that "team" are in the mood for a round of backslapping with a president whom they blame for the country's dire situation. Yet whether they like it or not, the end of 2016 found Zuma clinging on to power. Having avoided the downgrade and survived a November motion of no confidence from the ANC's National Executive Committee (NEC), the fate of "Team South Africa" or what's left of it--remains inextricably bound to the unpopular president.

"Zuma is weaker but not weak. He still has substantial raw political power as seen by his win in the National Executive Committee ... future attempts [to remove him] seem unlikely now unless the sands markedly shift," says Peter Attard Montalto, analyst at Nomura. That heated meeting--held in the confines of an upmarket hotel and conference centre on the outskirts of Pretoria in late November, witnessed perhaps the most audacious bid yet by anti-Zuma figures within the ANC to unseat their president. During three days of ill-tempered debate, the rebels--reported to include ministers Aaron Motsoaledi, Derek Hanekom and Thulas Nxesi--broke ranks to openly demand the leader's recall. For the president, a veteran tactician and survivor of the factional battles that have long plagued the ANC, the outcome of the meeting was rarely in doubt. Having deftly marshalled support and played off emerging factions during an unending year of scandal and economic turmoil, Zuma was always likely to have the numbers to see off a leadership bid in the NEC.

Who will succeed Zuma?

Yet while his victory represents a bolstering of his mandate in the run-up to the leadership conference in December 2017, where he hopes to anoint his chosen successor ahead of his 2019 compulsory retirement, analysts believe that the rebels' bid could be the beginning of a long-awaited realignment of opposition forces.

"I don't think they were expecting victory. I think the game plan was to test the waters and make sure they put their discontent on the record, but also to shift the balance of forces within the ANC," says Ralph Mathekga, an independent political analyst. "The bigger message is to demonstrate that Zuma is not hegemonic."

For the rebels, the wait for a candidate capable of taking the fight to Zuma has been long and frustrating. Cyril Ramaphosa, the popular deputy president, mining entrepreneur and veteran of the anti-apartheid struggle, has long been touted as a leader-in-waiting, but had previously kept his cards close to his chest.

In November, Ramaphosa was endorsed by the Congress of South Africa Trade Unions (COSATU)--the ANC-aligned organisation he previously led--before announcing his availability to stand weeks later.

"Ramaphosa has been giving speeches that could be interpreted as he's running as a successor, and he has been endorsed by COSATU. …

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