South Africa: A Battle Brews in the African National Congress
The ANC's market-oriented faction may one day decide to explore its options outside the ruling party, given its irreconcilable differences with Zuma's followers.
South African President Jacob Zuma's decision to dismiss Finance Minister Pravin Gordhan on March 30 caused uproar among leaders of the ruling African National Congress, its supporters and the other parties in its Tripartite Alliance.
Forecast
In light of the leadership contest in the African National Congress (ANC) and the recent dismissal of Finance Minister Pravin Gordhan, the South African government will push more populist policies to ensure that the ruling party's pro-labour camp retains its power.
Still, corruption investigations could hamper President Jacob Zuma's ability to influence the succession struggle. The brewing battle over Zuma's successor will widen the rifts in the ANC in the runup to the party's leadership congress in December, as Zuma works to secure a safe landing and pave the way for his desired heir.
Analysis
South African President Jacob Zuma's time in office may be winding down, but the contest to replace him as head of the ruling African National Congress (ANC) is heating up. The ANC, which has ruled South Africa since apartheid ended in 1994, will hold its next leadership congress in December, when Zuma will relinquish his post as party leader. As the all-important event approaches, Zuma is working to ensure that he leaves the office in good hands – and in good standing. On March 30, he dismissed Finance Minister Pravin Gordhan as part of a Cabinet reshuffle that swept 10 posts. The move caused uproar in the ANC's top ranks, among the party's coalition partners in the Tripartite Alliance, and in international financial markets. But it's just the latest episode in a succession saga that has pitted the ruling party's diverging factions against each other and threatens to widen the rifts between them.
A House Divided
Though political parties generally comprise different factions, the ANC is growing more and more divided as the party moves ever closer to its leadership congress. The long·
standing tensions between Zuma and Gordhan reflect this struggle: The president hails from the ANC's pro-labour wing, while the former finance minister is a member of its market-oriented faction. Zuma begrudgingly appointed Gordhan to head the Finance Ministry for a second time in late 2015 after his original choice for the post – a close confidant with little relevant experience – met with backlash from international markets. Zuma's new pick to replace Gordhan, another ally that lacked his predecessor's knowledge or skills, has likewise provoked resistance among the ANC's leadership.
The shake-up has also wreaked havoc on South Africa's economy. International investors viewed Gordhan as a steady hand in the country, a force against corruption, and a voice of fiscal reason. After he was called back to South Africa on March 27 (ironically, from an international roadshow meant to drum up foreign investment in the country) the South African rand tumbled, dropping 7 percent by the time Gordhan was fired. A few days later, Standard and Poor's downgraded South Africa's credit rating to junk status for the first time in 17 years.
Facing the Inevitable
But the very traits that endeared Gordhan to foreign investors also put him in Zuma's cross-hairs, particularly with the leadership congress looming. The event will set the ANC's course, and by extension that of the country, for years to come. In addition, it will determine what the final year of Zuma's tenure looks like. After more than two decades in power, the ANC is still very popular, wielding more influence in South Africa than the president himself does. And since Zuma's term in office will last until roughly April 2019, his political future rides in large part on who replaces him as party leader. To ensure that the party's ethnic Zulu, pro-labour faction retains power in the ANC, Zuma will have to energize and expand his support, for instance by increasing public spending and pushing populist policies such as the Black Economic Empowerment initiative. Contrary to Zuma's goals, however, Gordhan's main priorities as finance minister were to reduce South Africa's deficit, rein in spending and appeal to international investors. Their conflicting agendas meant that a power struggle was inevitable.
The scores of corruption charges currently hanging over Zuma's head, moreover, make it all the more important that a political ally replace him at the head of the ANC. Beyond his fiscal differences with Gordhan, Zuma undertook the reshuffle partly in an attempt to halt investigations against him and his close associates over allegations of trading influence in the government for business interests. South Africa's former public prosecutor detailed the claims in a report published in November 2016, drawing particular attention to Zuma's ties to the wealthy Gupta family, who received lucrative government contracts. Now, the president is awaiting a decision on his application to the Supreme Court of Appeal to dismiss all 783 corruption charges against him. Should the court decide in the president's favour, Zuma may hope to maintain his standing in the ANC. And if he loses, the National Prosecuting Authority will move forward with the cases against him, which would probably get underway around the same time that the ANC succession battle starts heating up. This could be a boon for Gordhan's camp, since the former finance minister was at the vanguard of the anti-corruption campaign against Zuma.
Prospects for Power
On the other hand, the ANC's marketoriented faction may one day decide to explore its options outside the ruling party, given its irreconcilable differences with Zuma's followers. Other factions of the ANC peeled off to form their own parties in the run-up to the leadership congresses in 2013 and 2008. Gordhan's wing, similarly, could break away and try to coordinate with the more right-leaning Democratic Alliance. For now, though, the ANC's marketoriented camp seems unlikely to take such a bold step. Instead, it will keep jockeying for power in hopes of taking control of enough high-level positions in the ruling party to clear out the old guard and its reputation for corruption. The best way to achieve that goal is to ensure that South African Deputy President Cyril Ramaphosa clinches the top spot during the party congress. Ramaphosa has already received an endorsement from the Congress of South African Trade Unions (COSATU), a prominent member of the ANC-led Tripartite Alliance.
His victory would bode ill for Zuma, however, signalling a split between his office and that of the ANC's leader. The rift could easily result in the kind of bumpy transition that the South African president knows all too well. After all, Zuma came to power in 2008 on a wave of discontent that recalled then-President Thabo Mbeki – who had by then lost his place at the head of the ANC – just months before the end of his term. Zuma's desire to preserve his legacy, and his supporters' desire to continue enjoying the spoils of power, will likely compel him to throw his weight behind a candidate capable of protecting his ethnic Zulu, pro-labour coalition. At this point, his ex-wife, Nkosazana Dlamini-Zuma, seems to fit the bill. A former government minister who has maintained close political ties with the president, Dlamini-Zuma returned to South Africa in mid-March after concluding her term as chair of the African Union Commission in Ethiopia. Since then, the ANC's League of Women has endorsed her to lead the party. If chosen as the ANC's next president, Dlamini-Zuma will probably continue her ex-husband's leadership style and policy approach.
But in the meantime, the contest to succeed Zuma at the head of the ANC will be brutal. The struggle could widen the fissures in the ruling party beyond repair, weakening its integrity and causing further breaks from the ANC. And depending on its outcome, the transition could even lead to Zuma's recall from the South African presidency. Either way, the country faces a rough road ahead between now and December.
“South Africa: A Battle Brews in the African National Congress” is republished with the permission of Stratfor, under content confederation between Financial Nigeria and Stratfor.
The scores of corruption charges currently hanging over Zuma's head, moreover, make it all the more important that a political ally replace him at the head of the ANC.