ANC Loses Key Towns as Discontent Boosts South Africa Opposition – Bloomberg

The African National Congress lost its stranglehold on South African politics as voter discontent over the struggling economy, a scarcity of jobs and scandals surrounding President Jacob Zuma cost it control of key cities and buoyed the two main opposition parties.

With 99.9 percent of the vote in on Saturday, the ANC secured 54.4 percent support in an Aug. 3 local government election, slipping below the 60 percent mark for the first time since it took power in 1994. It relinquished an outright majority in the capital, Pretoria, the industrial hub Ekurhuleni and the southern city of Port Elizabeth, final results for these areas showed. It’s also set to win less than half the votes in the economic center Johannesburg, according to preliminary results. With the Democratic Alliance strengthening its hold on Cape Town, the ruling party now controls only three of the country’s eight metropolitan areas.

“South Africa’s municipal election results bring a new dawn of coalitions at the local level that will alter the shape of politics in the long term,” Augustine Booth-Clibborn, an analyst at Africa Risk Consulting, said by e-mail. The ANC “now looks a rural, small-town party and could lose an election if it cedes much more urban ground,”

The ANC has struggled to meet its pledge to reduce a 27 percent unemployment rate and income inequality, as low commodity prices, a weak global economy and power shortages constrained growth. The central bank expects the economy to stagnate this year and the nation is at risk of having its credit rating downgraded to junk by S&P Global Ratings in December.

‘Huge Setback’

Zuma, 74, has been widely criticized since his decision to fire a respected finance minister in December caused a sell-off in the rand and nation’s bonds. The highest court ruled in March that he violated the constitution by refusing to repay taxpayer funds used to upgrade his private home. The ANC’s former head of intelligence, who has led Africa’s most-industrialized economy since May 2009, has fended off calls from within the party to resign with the backing of his allies who control its national executive committee.

The ANC has itself to blame for its decline because it became mired in infighting and neglected its supporters, according to Somadoda Fikeni, a political analyst at the University of South Africa.

“The ANC is at a crossroads of either renewing itself through deep introspection or literally speeding the process of its decline,” he said in an interview in Pretoria.

DA leader Mmusi Maimane speaks at the Independent Electoral Commission on Aug. 6.

The winners in the election were the DA, whose share of the national vote rose to 27.1 percent, from 22.2 percent in 2014 national elections, and the Economic Freedom Fighters, which won 8.2 percent support, up from 6.3 percent. Including voting for ward councilors, the ANC had 53.8 percent support and the DA 27 percent.

While the DA’s pro-business policies are poles apart from those of the EFF, which wants to nationalize mines and banks, the two parties may pair up to control hung councils if they follow through on their pledge not to partner with the ANC.

‘Headless Chickens’

“The leadership of the ANC is running around like headless chickens; they do not know whether they are coming or going,” EFF leader Julius Malema told reporters in Pretoria on Friday. “We are not prepared to speak to the ANC or engage in any form of coalition with the ANC, but you all know that we exist in a democratic country. We cannot close our ears when we are spoken to by anyone.”

For a Quicktake explainer on why the ANC is losing voter support, click here

The ANC won 41.4 support in Tshwane, the municipality that includes Pretoria, the DA 43.3 percent and the EFF 11.5 percent, tallies released by the Independent Electoral Commission show. In Johannesburg, the ruling party had 42.9 percent of the vote, the DA 40.7 percent and the EFF 10.7 percent.

In Ekurhuleni, a manufacturing hub to the east of Johannesburg which includes the nation’s main airport, the DA obtained 48.8 percent of votes, the ANC 34.1 percent and the EFF 11.1 percent.

The DA won 46.7 percent of the vote in Nelson Mandela Bay municipality, a vehicle manufacturing region that includes Port Elizabeth, and can ally with several smaller parties to control the council to the exclusion of the ANC and EFF. The ANC secured 41.5 percent of the vote in the council and the EFF 5 percent.

For a table of the latest results, click here

The rand gained as the results showed the ANC losing ground, which may press the party to introduce economic reforms. It was the best performer against the dollar on Thursday of 24 emerging markets currencies tracked by Bloomberg.

Performance Reflection

The 104-year-old ANC will address voter concerns and bounce back, said Deputy President Cyril Ramaphosa, a leading contender to succeed Zuma as the party’s president when his current term ends late next year. South Africa is due to hold its next national elections in 2019.

“We are a party that’s not going away from the body politic of this country,” Ramaphosa told reporters in Pretoria. “We learn from our mistakes.”

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