ANC set to lose majority

A model developed by a state research agency shows that South Africa’s ruling party looks set to fall well short of obtaining a parliamentary majority for the first time since it came to power at the end of apartheid three decades ago.

The African National Congress is on course to win 42% of the votes cast in Wednesday’s national election, according to projections from the Council for Scientific and Industrial Research, which are based on an extrapolation of early tallies released by South Africa’s electoral commission.

That would be a massive 15.5 percentage point drop from five years ago.  

If the projections prove accurate, the ANC will probably need to partner with one of its biggest rivals to retain power, giving it the choice of the market-friendly Democratic Alliance or one of two populist parties that back the nationalization of mines and banks.

The prospect of the ANC joining forces with those who would insist on policy changes that deter investment is unnerving the financial markets.

The rand weakened as much as 2% and traded at 18.70 per dollar by 10:56 a.m. in Johannesburg. Stocks also tumbled, with the FTSE/JSE Africa All Share Index falling as much as 2.3%.

The yield on local-currency bonds maturing in 2035 rose 17 basis points to 12.2%, a five-week high.

“This is a watershed moment for South Africa and has the potential to redraw the political map,” said Daniel Silke, the director of Cape Town-based Political Futures Consultancy.

“It ushers in an era of substantial uncertainty for South Africa as the ANC will be forced to choose its political bedfellows and the economic orientation that it will present to the country over the next five years.” 

The CSIR model, which has a 2% margin of error and proved broadly accurate in previous elections, was run using declared tallies from 8.24% of voting districts.

The model also shows that:

• The Democratic Alliance, currently the main opposition party, is likely to win 22.3% support nationally.
• The populist Economic Freedom Fighters is on track to garner 9%.
• The new uMkhonto weSizwe Party, which is led by former President Jacob Zuma, is expected to win 12.8%.

The projections, which were aired by the public broadcaster and don’t constitute an exit poll, are broadly in line with most forecasts from opinion polls that were conducted before the vote. Final results are expected to be announced over the weekend. 

“The ANC, if it continues in power, has to negotiate a coalition,” said Siphamandla Zondi, a politics professor at the University of Johannesburg. “It will test whether this country has mature political leaders.”

Nkenke Kekana, a member of the ANC’s National Executive Committee, said in a text message that it was “too early to talk coalitions.”

Support for the ANC has dwindled amid widespread disgruntlement over a moribund economy, unemployment at 33%, one of the world’s highest crime rates and the collapse of government services in many areas. 

Reforms instituted by President Cyril Ramaphosa’s administration, including addressing energy shortages and tackling snarl-ups on railways and ports, have made some progress in tackling the malaise.

Analysts see gross domestic product expanding 1.1% this year, up from 0.6% in 2023, and advancing further in 2025. 

“It’s still early, but if these trends continue it will be a painful wake up call for the governing party that is now being punished for lack of service delivery,” said Melanie Verwoerd, an independent analyst and former ANC lawmaker.

The official results from 14% of the 23,293 voting districts show the ANC had 42.6% support, the DA 25.8%, the EFF 8.5% and the MKP 7.9%