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Ruling ANC loses majority in parliament

Voters during the South Africa General Elections on May 29, 2024 in Johannesburg, South Africa. 

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South Africa’s governing African National Congress lost its parliamentary majority of 30 years, in the country’s most sweeping political shift since the end of the apartheid.

Popular support for the ANC during the May 29 vote came in at 40%, with the Democratic Alliance (DA) at 21.8%, and the Marxist Economic Freedom Fighters (EFF) clinching 9.5%, according to the country’s electoral commission with 99.9% of the votes counted. The six-months-old uMkhonto weSizwe party of the country’s former president Jacob Zuma, established in December, clinched 14.6% of votes.

The result marks a meteoric fall for ANC from the 57.5% wrested during the previous election of 2019 — at the time, the party’s weakest feat since South Africa’s first democratic vote in 1994. Long regarded as a symbol of liberation, the ANC has been on the backfoot in a battle with the practicalities of governance in recent years, amid a rise in systemic issues such as declining living standards, chronic power outages, decades-high violent crime rates and unemployment of almost 33%. In 2022, the World Bank named South Africa “the most unequal country in the world.”

“Top-of-mind issues for voters are unemployment, loadshedding, corruption, and crime, which have all taken a toll on the country’s growth performance for years,” analysts at Deloitte said at the start of the month.

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Unlike the party’s hero Nelson Mandela, who freely formed a power-sharing coalition to bridge distrust with rival parties in the fledgling years of South Africa’s democracy, the ANC’s incumbent leader Cyril Ramaphosa, 71, will have to negotiate a coalition to retain dominance — kickstarting a stretch of talks and uncertainty over the country’s political direction.

Investors will be watching how this changes the course for South Africa’s economic growth, pegged at 0.9% this year by the International Monetary Fund.

Inflation persists stickily at 5.2% in the latest May reading, above the South African central bank’s objective of 4.5%, where Governor Lesetja Kganyago says the print will stabilize in the second quarter of next year. The bank on Thursday held its main interest rate at 8.25%.

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