When the African National Congress swept to power under Nelson Mandela in South Africa’s first multiracial elections in 1994, its campaign slogan assured “a better life for all.” While enforced segregation has ended, more than a quarter of the workforce remains unemployed. Government data shows white households still earn five times as much as black ones. While the ANC has held on to power nationally, party support has fallen in cities amid charges of corruption and incompetence. Many have begun to doubt that the ANC will ever be able to deliver that “better life.” Now, in a bid to regain some of its former stature, the ANC has replaced Jacob Zuma as president.  

The Situation

On Feb. 14, Zuma announced his resignation as the party was preparing a no-confidence vote against him in the National Assembly. In December, the ANC elected Cyril Ramaphosa, the deputy president, to lead the party, putting him in position to replace Zuma. Calls for Zuma’s ouster had been growing louder as he lurched from crisis to crisis. He took office in 2009 just weeks after prosecutors dropped graft charges against him. In 2016, the nation’s top court ruled that he violated the constitution when he refused to repay taxpayer money spent on his private home. Markets were rocked in 2017 when he fired his finance minister, Pravin Gordhan. And after Zuma’s attempts to stymie the process, an investigation was launched into whether his son’s business partners, the Gupta family, exerted undue influence over state decisions. Voters have expressed anger over the stagnating economy and scandals surrounding Zuma. The ANC had a weak showing in local elections in August 2016 — it lost majority control of three of the biggest urban centers, including Johannesburg, the economic hub, and Pretoria, the capital. South Africa’s credit rating has been cut to junk by major rating agencies. The public schools system, ranked among the world’s most useless, leaves millions of youths without marketable skills.

The Background

In 1652, the Dutch East India Company established a supply post in Cape Town, which the British occupied in 1795 to secure the sea route around the southern tip of Africa. British immigrants settled mainly in coastal areas, while Dutch colonists — known as Boers or farmers — migrated to the interior. Discovery of inland gold and diamond deposits spurred the Anglo-Boer Wars, which the British won in 1902, making South Africa a British colony. White colonists adopted a constitution in 1910 that disenfranchised blacks, whom they viewed primarily as cheap labor. The National Party took power in 1948, stripped black South Africans of their land and denied them decent education and health care under a policy known as apartheid, or apartness. In 1961, Prime Minister Hendrik Verwoerd declared a republic and severed ties with the U.K. South Africa endured decades of economic sanctions and an armed struggle by the ANC and other groups before the government agreed to free Mandela from prison in 1990 and hold multiracial elections. The ANC has won a majority in every election since.

The Argument

Ramaphosa has pledged to fight corruption, revive the struggling economy and restore investor confidence. He’s convinced many that he means it. The rand has been the best currency performer against the dollar since his Dec. 18 election as party leader. With Zuma gone, Ramaphosa hopes to have enough time to meet his pledges before the 2019 elections. The ANC-controlled government has been able to point to some successes. The economy has almost trebled in size in the past two decades. Life expectancy is rising and infant mortality rates are dropping. Yet the economy grew by just about 0.7 percent last year. Laws that discourage the hiring of temporary workers added to unemployment. Many have lost patience. While the ANC still has support thanks to its role in ending apartheid and the state’s extension of welfare to almost a third of the population, the party is nervous. The two main opposition parties, the pro-business Democratic Alliance and the socialist Economic Freedom Fighters, together won 35.2 percent of the national vote in August 2016, up from 28.5 in 2014. While the two parties have vastly different visions for the future, they share a desire to see the ANC taken down and have voted together to wrest control of the major cities from the ruling party. 

First published Aug.

To contact the writer of this QuickTake: Michael Cohen in Cape Town at mcohen21@bloomberg.net.

To contact the editor responsible for this QuickTake: Anne Cronin at acronin14@bloomberg.net.

©2018 Bloomberg L.P.