Business worried congress will not go ahead

SA’s main business group fears the country will be stuck in political limbo if infighting causes the governing party’s elective conference in December not to go ahead.

The race to succeed President Jacob Zuma as leader of the ANC is widely seen as a headto-head contest between his deputy Cyril Ramaphosa and Nkosazana Dlamini-Zuma, the former AU Commission chairwoman who is now an MP.

The ANC was working to resolve its differences to ensure the conference went ahead and to avoid a repetition of previous splits, which spawned three opposition parties, said treasurergeneral Zweli Mkhize, who is also a candidate.

The task of uniting the ANC after the damage to its image caused by Zuma’s scandalridden presidency is daunting.

A bitter split in KwaZuluNatal has effectively left the province without party leadership and allies such as Cosatu and the South African Communist Party are openly calling for the president to go.

“What begins to worry us now is the congress not happening at all, because the branches are so disorganised,” Business Leadership SA CEO Bonang Mohale said.

Business Leadership SA represents about 80 of the country’s biggest companies.

The economy staged a weak recovery from the second recession in less than a decade in the three months to June 30 and business confidence is near the lowest in 30 years.

Concerns about policy and political uncertainty, along with weak domestic demand, weighed heavily on business and consumer confidence, deterring investment and job creation, the Treasury said in its medium-term budget policy statement last week.

Taxpayer compliance was also deteriorating, it said, with allegations of corruption and mismanagement of state resources affecting collections.

Business Leadership SA members have pledged anticorruption measures such as protecting whistle-blowers.

“There’s the realisation that the government on its own is not going to take this country out of this morass,” Mohale said.

The rand slid to the lowest in about a year after the Treasury almost halved its economic growth forecast for 2017 to 0.7% and said debt was predicted to rise. The deteriorating trajectory threatens to trigger a downgrade of rand-denominated securities to junk by S&P Global Ratings and Moody’s. Fitch already assesses the domestic currency debt as subinvestment.

“The real example of how bad the medium-term budget policy statement has been is that we’ve now moved from a downgrade being probable to a downgrade being certain,” Mohale said.