Goldilocks vote has Ramaphosa in driving seat

The African National Congress will secure just enough of a majority from Wednesday’s election to give President Cyril Ramaphosa a definitive mandate, while curbing the party’s quarter-century monopoly on political power, partial tallies show.

The ANC was leading with 56.6% after ballots from 70% of the voting stations were counted. That’s far short of the 62.2% it took in the last national poll five years ago, but up from its municipal-election showing in 2016. The ANC is in a tight race to retain its majority in Gauteng, numbers released by the Independent Electoral Commission in the capital, Pretoria, show.

Read: ANC set to retain power in South Africa but support slips

The emerging results indicate neither the big win that Ramaphosa, 66, needed to strengthen his bid to push through reforms to boost investor confidence, nor a disaster for the ANC, whose reputation has been damaged by the scandal-marred rule of his predecessor, Jacob Zuma.

“It leaves us with a party that’s been discredited, but it gives a strong mandate to Ramaphosa to clean up,” said Amanda Gouws, a politics professor at the University of Stellenbosch. “He should be able to appoint a cabinet of his choice.”

The rand was little changed at 14.34 per dollar by 11:58 p.m. in Johannesburg on Thursday. Yields on benchmark 2026 government bonds fell five basis points to 8.54%.

A key battleground is Gauteng, which includes Pretoria and the economic hub of Johannesburg. The ruling party lost both cities in 2016, with the Democratic Alliance taking control with support from smaller parties. The latest projections from the Council for Scientific and Industrial Research and the public broadcaster show the ANC will narrowly retain the province that makes up a third of the nation’s gross domestic product.

A lawyer and former labor-union leader, Ramaphosa won control of the ANC in December 2017 and ascended to the presidency two months later after the party forced Zuma to quit. Zuma allies secured a number of other top ANC and government posts, raising speculation they may try to oust Ramaphosa at the party’s next elective conference in 2022 — a scenario that now appears increasingly unlikely.

“President Ramaphosa is safe as head of the ANC,” Fikile Mbalula, the ANC’s head of elections, said in an interview. “All party members are 100% behind him. The party has done well, especially after the doldrums we were in before the elections.”

Since taking office, Ramaphosa has pledged to crack down on the corruption that characterised Zuma’s nine-year rule and spearheaded a drive to attract $100 billion in new investment.

Investors are also looking to him to also implement structural reforms to revive an economy that has expanded by less than 1.5% for the past four years and tackle a 27% unemployment rate.

The election will allocate seats in the 400-member National Assembly and nine provincial legislatures on a proportional basis. A first meeting of parliament is provisionally set for May 22 where the president will be officially elected.

The ANC’s main challengers among 48 parties in the national vote were Mmusi Maimane’s center-right DA and the populist Economic Freedom Fighters, led by former ANC youth-wing leader Julius Malema. The DA secured 22.5% support and the EFF 9.9%, the partial tallies showed.

“The political arena in South Africa is going to look pretty much the same as it did before the elections,” said Dawie Roodt, chief economist at the Pretoria-based Efficient Group. “The important next question is who is going to be in cabinet and will the president really consolidate his power.”

© 2019 Bloomberg L.P