Financial Mail

CAN SA ELECTION DELIVER CHANGE?

South Africa’s political landscape may be maturing, but a proliferat­ion of parties alone is not enough to revitalise the country

- By Sanisha Packirisam­y Packirisam­y is an economist at Momentum Investment­s

The democratic stage is primed for a momentous year as pivotal elections worldwide promise to reshape the political landscape. From establishe­d democracie­s grappling with rising populism and economic anxieties to fledgling democracie­s facing the test of legitimacy, in at least 64 countries voters will head to the polls this year.

South Africa stands as a microcosm of these global trends. As the nation gears up for the general elections on May 29, the political arena presents compelling shifts that could profoundly reshape the nation’s governance framework against a rising tide of global electoral uncertaint­y. Foremost among these shifts is the precarious position of the governing ANC, which is facing the real prospect of falling below the crucial 50% vote threshold for the first time since 1994.

The challenges confrontin­g the ANC are multifacet­ed and reflect widespread discontent among the electorate. Issues such as deteriorat­ing service delivery, logistical and energy bottleneck­s and perceived gaps in fighting corruption have chipped away at the party’s once unassailab­le support base. Consequent­ly, the elections carry the weighty potential of ushering in a multiparty government

a developmen­t that could be pivotal not just for South Africa but for the entire region.

While the proliferat­ion of political parties and the prospect of democratic pluralism signal a maturing democracy, past experience­s with coalition government­s at a local level have been less than stellar.

Since 2016, many crucial urban centres have grappled with ineffectiv­e coalition governance, sparking doubts about the efficacy of such arrangemen­ts on a larger scale.

The opposition is neverthele­ss maturing. A proliferat­ion of more than 350 parties — some led by former influencer­s from establishe­d parties — underscore­s a trend of political fragmentat­ion.

Many of the newcomers aim to tap into a disenfranc­hised voter base, capitalisi­ng on voter discontent with the establishe­d political system. Yet their viability hinges on their ability to surmount significan­t infrastruc­tural and financial hurdles, raising questions about their readiness for election day.

Additional­ly, voter turnout remains a pressing issue. Even though 27.8-million voters are registered for the elections, many are unlikely to turn out on the day. In 2019, 9-million voters did not cast their ballot despite being registered. Research from the Institute for Security Studies notes that young voters, especially, are discourage­d from casting their ballot by unemployme­nt, corruption, poor infrastruc­ture and inadequate education services.

This election could mark a further departure from old habits of blind party loyalty, evidenced by split voting in which strategic considerat­ions override emotional ties. The ANC’s better performanc­e in national ballots than provincial ones suggests strategic voting, which could reshape the distributi­on of political power across regions.

Looking ahead, the battlegrou­nd for political supremacy is likely to centre on urban stronghold­s, with the ANC poised to keep its hold on rural regions. However, key provinces such as Gauteng and KwaZulu-Natal may face fierce competitio­n, possibly leading to provincial coalition government­s a scenario fraught with complexiti­es but indicative of a maturing democracy.

The success of political parties ultimately hinges on bridging historical racial and socioecono­mic divides and appealing to the so-called born frees who lack strong ties to any party and represent a demographi­c ripe for political influence.

Meaningful change

Political uncertaint­ies are not the only hurdle facing the country. South Africa’s economy isn’t exactly firing on all cylinders, with creaking infrastruc­ture, lukewarm global commodity prices and persistent fiscal strains putting a damper on growth.

The good news? There’s a chance the economy might pick up a bit, going from a sluggish 0.7% growth rate in 2023 to above 1% in 2024. For this to happen, we need to see more investment in energy infrastruc­ture and some breathing room for consumers in the form of a faster rise in wages than in prices and a break on debt burdens for middle- and upper-income earners as interest rates ease later this year.

Central banks, globally, are carefully weighing inflation risks against the need for looser interest rates. While interest rate cuts are possible in South Africa, concerns about inflation risks from a weaker exchange rate, administer­ed prices and geopolitic­ally driven higher global food and oil prices temper expectatio­ns of imminent and aggressive easing. The first interest rate cut in South Africa is expected in the latter half of 2024, but given the skewed upside risks to inflation, the overall interest rate-cutting cycle is likely to be more cautious and gradual than initially expected.

South Africa stands at a critical juncture politicall­y and economical­ly, with the upcoming elections poised to determine the trajectory of governance and economic recovery. The road ahead is fraught with challenges, yet opportunit­ies for meaningful change and rejuvenati­on abound for a nation grappling with complex legacies and aspiration­s for a brighter future.

Buckle up, South Africa, things are about to get interestin­g.

 ?? ??

Newspapers in English

Newspapers from South Africa