South Africa is increasingly difficult to govern.
Cyril Ramaphosa, newly elected president of South Africa, will have to navigate tricky crosscurrents in the ANC party over economic reform. The May 8 elections saw the ANC’s power challenged, with its share of the vote falling below 60% for the first time since the end of apartheid in 1994—although the party did manage to retain a parliamentary majority.
Ramaphosa came into office in February 2018 after the ANC forced out scandal-plagued Jacob Zuma. Economists and analysts say Ramaphosa has to work harder in rooting out corruption and setting the pace for economic policies to help win back investors.
“The degree to which the president feels empowered will determine the pace with which he tackles much-needed reforms,” says Indigo Ellis, Africa expert and analyst at Verisk Maplecroft. “We expect Ramaphosa to begin necessary economic reorganization, especially of state power company, Eskom, cushioned by a strong national-level mandate.”
The South African economy has not given Ramaphosa a break. StatsSouth Africa said the unemployment rate for the first quarter 2019 rose to 27.6% compared with 27.1% in the same period last year. Fitch Ratings revised South Africa’s 2019 GDP growth forecast to 1.6% from an earlier projection of 2.1%, citing continued decline in business confidence.
Unemployment is a major stumbling block. Analysts at NKC African Economics say the latest employment figures “reflect the economic headwinds” facing South Africa.
According to Fitch, structural obstacles to Ramaphosa’s economic reform agenda remain, including persistent vested interests. For his part, the new South African leader has pledged a different approach to that of Zuma. “We are going to do things differently. We are going to do things effectively,” said Ramaphosa. “We are going to make sure we inject growth … we are going to invite investors.
