Ray Hartley Editor: BusinessLIVE
Cyril Ramaphosa. Picture: REUTERS
Cyril Ramaphosa. Picture: REUTERS

Cyril Ramaphosa has been elected president of the ANC, crowning a political career that spans the trade union movement, negotiating South Africa’s constitution and amassing a fortune in business.

His ascension to power followed one of the most bitter, divisive and personal election contests in the ANC’s history and his first challenge will be to unite the party behind his vision.

But there is an immediate obstacle.

Ramaphosa has promised to be tough on corruption and to see to it that the perpetrators of state capture are brought to book. He has vowed to see to it that the money stolen during state capture is returned.

There is no way that he can live up to these promises without an all-out assault on his predecessor, Jacob Zuma, who has avoided criminal charges for corruption and who is at the centre of the state capture web.

Prosecuting Zuma will add to divisions in the party and alienate the substantial part of the organisation which still backs Zuma.

Ramaphosa will have to choose: Party unity or electoral credibility.

This throws the election of the party’s national executive committee into sharp relief. If Ramaphosa can pack the NEC with his supporters, he will enjoy political protection if he pursues Zuma. If not, he will find himself without the party’s backing.

The bold move would be for Ramaphosa to immediately replace Zuma and appoint the commission of inquiry into state capture. Such a commission, working hand-in-glove with special prosecutors, could become a permanent fixture along the lines of the Chinese anti-corruption commission.

Ramaphosa will also have to turn his attention to the economy. Here again, he will face a difficult choice: Work on winning the confidence of investors and business or send a signal to the party that he really is as keen on ‘radical economic transformation’ as he has made out on the campaign trail.

Ramaphosa’s predicament is exacerbated by the fact that the trade union federation Cosatu, and the SACP, as well as a host of left-of-centre ANC activists, have been his strongest backers.

He needs to avoid being seen as the ‘running dog’ of big business while convincing them that they have a large role to play in the economy.

He is likely to dodge this bullet with his ‘new deal’ platform. He will begin a negotiation process between government, business and labour over how to rescue the economy. By convening such a process, he will be able to act as the neutral mediator, avoiding having to take sides.

But it will take all of his negotiation skills to craft a consensus among these players.

Government will follow the line, but business and labour are likely to have radically different ideas about curbing public spending, the sale of stakes in ailing public enterprises and how to free up job creation.

While doing all of this, Ramaphosa is going to have find ways to release the financial pressure on the highly-geared middle class, which has deserted the ANC over the past 10 years. A quick win would be to end the e-tolls project. It’s on its last legs anyway.

More difficult will be reducing the financial burden on this stressed layer of traditional ANC support without damaging tax collection.

This and reducing youth employment are the only things that will slow or reverse the ANC’s electoral slide.

In short, Ramaphosa is going to have call on all of his negotiation skills if he is to turn the ANC’s electoral fortunes around.

 

 


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