G20, politics to take centre stage in 2025

SA will be thrust into the intentional spotlight in 2025 as it takes the reins of the forum of the world’s largest economies, the G20.

Until 2023, SA was the only African country to be part of the G20. The country seeks to use its rotational one-year presidency, which began in December, to prioritise climate issues and reform of multilateral institutions.

SA’s G20 presidency will work on global issues through three dedicated task forces. The first is on inclusive economic growth, industrialisation, employment and reduced inequality, the second on food security and the third on artificial intelligence, data governance and innovation for sustainable development.

A series of high-level meetings will be hosted by various government departments throughout the year leading to the leaders’ summit in November to be hosted by the City of Johannesburg. The National Treasury and the Reserve Bank are leading the finance track, and the department of international relations and co-operation (Dirco) are leading the sherpa track.

The G20 is a group of countries that meets to discuss plans for the global economy. Between them, they account for two-thirds of the global population, 85% of the world’s economic output and 75% of world trade.

Within the first six months of 2025 the country is expected to host the SA-EU Summit. SA is the only African partner of the EU’s 10 bilateral strategic partnerships. It is expected to use the summit to cement its trade relations with the bloc amid its western partners’ concern about its  relationships with Russia and China.

The 10-party government of national unity, established after the 2024 general election in which the ANC lost its parliamentary majority, will seek to build on positive sentiment to turn the tide of the ailing economy.

So far, the GNU has shown no tangible improvement in key economic indicators with the official unemployment rate at a high 32,9%. Rating’s agencies Moody’s and S&P Global affirmed their outlook on SA’s growth in late 2024, but said that SA’s economic and fiscal performance could improve better than expected if reforms accelerated.

President Cyril Ramaphosa is expected to present details of the GNU’s medium-term economic plan in his state of the nation address in February.

The government’s draft policy blueprint for the medium term has targeted GDP growth ranging from 2% to 5.4% by 2029. The draft medium term development plan (MTDP) was presented at an extended cabinet meeting in October. The ministers decided on further consultation on the policy document before it was finalised. The document is expected to be finalised by January at a cabinet lekgotla.

Policy differences among the GNU’s partners are once again expected play out in public. The first test will be implementing the Basic Education Laws Amendment (Bela)  Act in time for the new school year. The act stipulates that provincial education department heads, and not their governing bodies, will have the final say on schools’ admission and language policies.

GNU members have clashed over the National Health Insurance (NHI) Act, which Ramaphosa signed into law in May. Health minister Aaron Motsoaledi said he was determined to push ahead with it despite legal challenges and opposition by some political parties.

The public sector wage bill remains a crucial challenge for the government. The wage demands for the 2025/26 financial year put finance minister Enoch Godongwana in a tight spot, threatening to undermine his efforts to stabilise SA’s finances. He has kept a tight lid on the R700bn-plus wage bill, which was once the fastest-growing expenditure item in the budget.

Delivering the medium-term budget policy statement, Godongwana said the government was implementing a raft of measures, including early retirement, to curb expenditure in the medium term, when consolidated expenditure was expected to rise from R2.4-trillion in 2024/25 to R2.8-trillion in 2027/28.

Internal clamouring in the ANC is likely to increase somewhat before its national general council (NGC) meeting, the 2026 local government elections and its internal leadership contest in 2029. 

The establishment of the GNU, where ANC NEC decided to coalesce with its former rivals will be high on the agenda of the NGC. Opposing factions in the party will probably use the opportunity to register their approval or disapproval of the coalition government.

The NGC does not adopt policy or elect leaders, but provides an opportunity for factions to test the waters before the next elective conference.

The DA will in January, announce the opening of candidate applications for the local government elections. “It also signals ... our readiness for the elections,” said DA leader, John Steenhuisen’s office. He said that the applications would be open for at least a year.

The municipal elections should be held between November 2 2026 and February 1 2027. Political parties will be looking to build on their successes in the 2024 elections.

maekot@businesslive.co.za