After a rocky start, South African President Jacob Zuma enters his third year in office with a firm grip on power and grand plans to transform Africa’s largest economy.
Investors worry that the government’s call to end corruption will be given lip service, with Zuma doing little to end deals that critics say benefit his allies in the African National Congress and in business.
But through compromises, Zuma appears to have defused tensions between the ANC and governing partner the Congress of South African Trade Unions (Cosatu), the country’s largest labour federation which can use its two million members as a powerful vote-gathering machine and has been demanding a greater say in forming economic policies.
“Under Zuma, the ANC has gone closer to Cosatu in terms of macroeconomic policy but it does not mean that the left has captured the ANC and the country,” said independent political analyst Nic Borain.
Cosatu has labelled the new growth plan, which aims to create five million jobs by 2020, “incoherent and vague” but analysts say the criticism is unjustified as the blueprints were drawn up by former unionist Economic Development Minister Ebrahim Patel and are similar to Coastu’s own growth strategies.
“Zuma has played this brilliantly. The NGP is infinitely closer to Cosatu’s own growth strategies. It proposes looser monetary policy but calls for tighter fiscal controls mean that Cosatu has not won the day,” Borain said.
Zuma’s economic team helped steer the world’s 26th biggest economy out of its first recession in nearly two decades and expects growth of 3,5% this year, up from an estimated 3% in 2010. That however, pales in comparison to major African oil producers Nigeria and Angola.
Consolidating power
The growth plan may eventually fall by the wayside but Zuma’s biggest challenge now is to keep rivals in check as the ANC elects new leaders in 2012.
Since taking office in 2009, Zuma’s polygamous personal life, failure to rein in unions who launched damaging wage strikes last year and a lack of leadership led analysts to doubt if he would complete his term ending 2014.
His fortunes began to change at a major ANC policy making conference in September when he suppressed a leadership challenge fronted by youth league leader Julius Malema and backed by more senior members.
A major Cabinet overhaul in October, when seven ministers were fired in one of the country’s largest reshuffles, served notice that Zuma would throw allies overboard if they underperformed or became too much of a political liability.
Economists have been reassured by Zuma’s decision to leave keep his core economic team intact while fending off calls from Cosatu and in the ruling party to back left-leaning policies.
Zuma has also done well internationally, serving as the gracious host of the well-received Soccer World Cup last year and more recently winning an invitation from China to join a summit of the Bric grouping of major emerging economies.
Many other emerging economies with stronger numbers have tried to join the grouping of Brazil, Russia, India and China.
But Zuma’s lobbying of his country’s number one trade partner, Beijing, proved successful with South Africa punching above its weight with arguments the group would benefit politically from having Africa’s biggest economy as a member, analysts said.
Risks
Zuma’s next major tests will be municipal polls planned for the first half of 2011 and keeping his personal life in order.
The ANC has faced violent protests from poor blacks for failing to provide them with running water, electricity, basic schools and healthcare 17 years after the end of apartheid and white minority rule.
The ANC will win the bulk of the elections due to its dominant political power but any gains by minor opposition parties could embarrass Zuma and fuel the hopes of his rivals in the ANC and at Cosatu.
“Part of Zuma’s new approach has been to question inefficiencies and the role of ANC office bearers at local government. Calling his own party to account will go down well with the rank and file,” said political analyst Daniel Silke.
Despite threats from Cosatu that its workers will not be used “as voting cattle” or “sign a blank cheque” and endorse ANC candidates who are perceived as corrupt in the upcoming elections, it is unlikely that the labour federation will take away its traditional support for the ruling party.
One ANC insider described Zuma as the “glue” that holds the diverse factions of the ANC together who will most likely receive a second term if he can avoid scandals.
“It will not come without a fight. Embarrassing details of his personal life, business deals by his family members and cronyism by those closest could ruin his chances. It’s just a matter of how dirty his rivals are willing to play,” said the insider who did not want to be named. – Reuters