South Africa’s ANC Sees Power Crumble With Nearly All Votes In

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South Africa’s African National Congress is set to cede its parliamentary majority for the first time after voters dealt a historic rebuke to the party Nelson Mandela led to power at the end of apartheid.

With almost 99% of ballots cast in the May 29 election counted, the ANC has 40.2% of the vote, while a party led by former ANC and national President Jacob Zuma garnering 14.8% just five months after its launch.

The ANC’s collapse from its 57.5% share in 2019 comes after years of economic mismanagement and corruption left a third of South Africans unemployed and having to contend with erratic water and power supplies. The result is uncharted territory for the country, with the ANC now having to consider working with its political opponents for the first time to stay in power.

“It’s a bit of a shell-shock moment” for the ANC, said Sanusha Naidu, a Cape Town-based research associate at the Institute for Global Dialogue. “They have done this to themselves.”

The extent of its loss leaves the ANC with the choice of seeking an alliance on the left with either Zuma’s uMkhonto weSizwe Party, known as MKP, or the populist Economic Freedom Fighters, or turning to the biggest opposition party, the centrist Democratic Alliance. The DA garnered 21.7% of the vote, while the EFF had 9.4%.

If the ANC chooses to form a minority government, it will still need the support of a rival to appoint a president as that position is voted on by parliament.

For financial markets, its choice of partner is key, as both MKP and the EFF have laid out demands that everything from land to banks is nationalized and the prospect of them joining the government has spurred a selloff in the rand and the nation’s bonds. An alliance with the DA would likely accelerate the economic reforms and privatization initiatives that President Cyril Ramaphosa had begun to put in place.

“It’s pretty binary,” said Martin Kingston, chairman of the local unit of Rothschild & Co. “That is the best- and worst-case scenarios for business.”

Ramaphosa’s allies prefer an investor-favored pact with the business-friendly DA, which would keep him at the helm, according to people familiar with the situation. Some of his detractors in the party favor one with EFF and MKP, which could see Ramaphosa ousted or resigned.

If he does step down, that would represent a victory for Zuma, who was fired as deputy president in 2005 amid corruption allegations, won control of the ANC in 2007, and led the country for almost nine years before being ousted by his own party and replaced by Ramaphosa in 2018. Since then, he’s been fighting a legal battle against charges of taking bribes to facilitate an arms deal in the 1990s and served time in jail after refusing to testify before a judicial inquiry into state graft.

Final results are expected later in the weekend, as are coalition discussions, with the leaders of both the ANC and the DA meeting separately this weekend to chart a way forward. Under the constitution, South Africa’s National Assembly must convene within 14 days to elect a speaker and a president after the declaration of the election outcome.