South Africa’s “messy” political landscape is not aiding the country’s economic growth ambitions, Centre for Politics and Research executive director Prince Mashele told delegates at a recent Gordon Institute of Business Science (GIBS) discussion. “We are in a mess politically,” he lamented, pointing out that the economy was unable to fully thrive in this environment.
Discussing South Africa’s economic outlook, Mashele claimed that the ruling African National Congress (ANC) had lost control of South African President Jacob Zuma, who, he said, was now a “massive liability to the party and to the country”.
The party also had no control over its general members, who had embarked on violent and destructive rampages in Tshwane and KwaZulu-Natal in recent times.
The ANC had also lost control of the State, he said, citing heavy civil unrest, particularly in rural regions, where communities were burning down schools and other essential infrastructure without much intervention.
He also cited the country’s migration policies and open borders that were not managed well, in addition to the high unemployment rate, among other issues.
This was exacerbated by a fragmented, disorganised and weak civil society that did not speak with one voice.
“The economy is in trouble,” Mashele commented, adding that it was necessary for the ANC to take back control of the State and reinject a measure of stability and confidence.
And this could see the emergence of a game-changing, “interesting” coalition government that could become a “good story” and a lesson to the ANC to shape up or ship out.
Mashele noted that, following the municipal government elections on August 3, the ANC would likely lose its governance of Tshwane and Johannesburg, as well as Nelson Mandela Bay, to the Democratic Alliance (DA) or the Economic Freedom Fighters (EFF), a move which would make for an admittedly difficult partnership as the parties would be required to form an alliance.
Mashele noted that the ANC would find itself, in effect, a “rural party” should it lose Gauteng in August.
However, cogoverning of South Africa’s largest economic hubs may be an experiment for the country, he added.
The Institute for Security Studies (ISS) previously explained that a political turning point was fast approaching, attached to the “unprecedented era” of coalition politics at national level.
The institute explained that it was likely that ANC support, which was on a downward trajectory already, would dip below 50% during the 2019 elections, requiring the party to enter into an alliance with another party.
“Political change led by a reformist ANC – either as the dominant party or in a coalition with the DA at local and provincial levels – that ushers in a commitment to a labour-intensive, low-wage and a less-regulated growth path could, in time, reduce much of the country’s economic and social malaise,” the ISS had reported in a June paper.
However, Department of Trade and Industry chief economist Stephen Hanival argued that political uncertainty was a clear challenge to economic growth; however, there were ways of mitigating this through the stimulation of key industries and investment attraction.
“What it comes down to is economic growth and profitability . . . If the economy is growing at 4%, who our next President is goes out the window,” he said.
Policy certainty, the implementation of focused development plans, the creation of a conducive investment environment and subsequent job creation, among other factors, would be key.
Mashele agreed that society could be “more forgiving” and “feel better” if the economy was growing by 4%; however, politics would always remain relevant and the country needed national coherence.
The State needed to inspire confidence and stability and was ultimately responsible for coherent, coordinated and aligned policy certainty. It also needed to ensure stability in its own institutions and functional State-owned entities.
“While current conditions may look dismal, politics are more fluid than they have ever been and South Africa continues to have significant pent-up economic growth potential. The next few years will indicate if political developments can unlock a more prosperous future for all,” the ISS noted in its report.