- I have been inactive for the longest time for fear of sounding like a politician, repeating the same boring themes that are playing themselves out in the financial markets.
- Inflation up or down, therefore yields down or up, splutter splutter, cough cough, zzzzzzzzzz.
- I’ve also been a little busier at work than was ordinarily the case, and so to my 3 loyal readers I apologize if you have missed me.
- Speaking of politicians, SA’s election is fast approaching, and for the first time in 30 years, the outcome is far from guaranteed.
- For 3 decades the ANC has enjoyed almost 100% dominance at National, Provincial and Municipal levels.
- That all seems about to change.
- Which raises serious questions about South Africa’s political, and therefore, politics being economics, South Africa’s economic future.
- And so perhaps it’s time to revive my literary career with a little analysis about what South Africans can look forward to post 29 May.
- I mean, If I find it difficult to predict what the Rand will do, I may as well have a stab at what our politics will look like.
- First up – there are over 300 political parties contesting these elections at various levels!!!
- Don’t for one moment think that 295 are irrelevant. Johannesburg currently has a mayor whose security detail is bigger than the number of people who voted for his party. Smaller parties will definitely have an influence on the economic fortunes of our beautiful Country.
- Secondly the factions within the ANC have led to the rise of Jacob Zuma’s MK party.
- Yesterday’s high court ruling has paved the way for the Ex- President to contest this year’s election. It’s quite a resurrection for a man that was paroled early on his contempt of court incarceration, apparently because his health was so poor that he was in danger of exiting stage left.
- MK will definitely have an influence on the results of this year’s election.
- If polls are to be believed, coalitions are almost 100% assured.
- And so, let’s look at what this potential universe of outcomes may look like.
- Let’s deal with the easy one first – the so called “Moonshot pact”. Likeminded liberal parties outside of the ANC’s influence, banding together to run the show.
- Our analysis suggests that I have more chance of performing on stage with Taylor Swift.
- The numbers simply do not add up. At best, the coalition of the disaffected could garner together roughly 30% of the collective will of the people. Already cracks are beginning to appear. The only thing holding these parties together is their collective will to see the demise of the ANC. Beyond that they argue like schoolyard kids disagreeing over which part of the toasted sandwich is the best to eat.
- The DA on its own – add in Beyonce and Bruno Mars to my live performance analogy.
- The EFF on their own – even though they are making more promises about free stuff than Oprah in her heyday. Also zero.
- Which leaves us with the ANC – they of the “load shedding will end any day now, along with corruption and poor political choices”.
- I think there is little doubt that they will still garner the largest portion of the votes – but will they obtain a majority? This looks highly unlikely.
- So, they should have the first stab at putting together a partnership that will Govern for the next 5 years.
- And this is where it gets interesting.
- In the middle ages, the European aristocracy were prone to marrying off their offspring in an attempt at forging lasting alliances. Love and affection had absolutely nothing to do with these arrangements, and they often ended in disaster as the Prince or King quickly tired of his politically appointed bestie, leading him to find reasons to incarcerate the poor damsel, all while he cast his eyes over his court for more appealing younger maidens. Any collation should be seen in this light.
- Depending on their overall percentage of the popular vote, the ANC may be able to co-opt a few smaller parties to get them over the line, in which case the next 5 years would simply be a rinse and repeat of the past 30 years.
- However, some polls are suggesting that they may struggle to get to 40%, which means that they would need to partner with at least one of the bigger opposition parties.
- The most obvious partnership would be to bring Julius Malema and his fighters back into the fold. Malema himself has recently stated that they would consider such a partnership, only if Floyd Shivambu were appointed Finance Minister. I would imagine that Julius himself has his eyes set on the Deputy Presidency. Now whether his Shivambu comments were made in jest (or fear mongering) or not, the economic outcome of this scenario would be less than ideal.
- I would also imagine that one of the EFF demands would be that President Ramaphosa vacates his residency as President. From an economic perspective this is the least desirable outcome. The EFF’s economic policy is fraught with peril. Double grants, free everything, Land controlled by the State, Nationalization of key economic contributors all come storming back onto the agenda.
- Potential Outcome? – possible but undesirable. How probable is it – I’m putting the chances at around 35%.
- Next up – the ANC and MK? This would also mean that President Ramaphosa joins the ranks of the unemployed. What role does Jacob Zuma play? It probably leads to a further split within the ANC.
- The economic outcome would be similar to an ANC/EFF partnership.
- Likelihood? I think around 20%.
- Which leaves us with another potential outcome, one that is gaining popular momentum. A joining together of the old foes, the ANC with the DA.
- I have to admit that it’s very difficult for me to imagine this as a realistic possibility. Too much water has flowed. The ideologies are polar opposites, and I’m guessing that many in the ANC (along with a certain grouping within the DA) would simply see this as untenable and impossible to achieve.
- There is a grouping of moderates on either side that could make this happen. The question is do these individuals have enough power in their respective parties to make it a reality.
- There is little doubt that this would be the best outcome from an economic perspective, but I think the likelihood is less than 10% currently …but maybe, just maybe...
- I realize that my that my arithmetic described above does not add up to 100%. It’s not that I don’t know how to do addition, it’s the fact that the possible permutations of this year’s election are numerous.
- Politicians make strange bed fellows. Personal agendas and interests will always play a role.
- Just ask the aristocracy.
- Not to be too dramatic – but there is a lot riding on May 29. Perhaps an important as 27 April 1994.
