Lawmakers from South Africa’s governing African National Congress rejected an advisory panel’s report that found President Cyril Ramaphosa may have breached the constitution, bolstering his campaign for re-election as party leader.
The rand and government bonds rallied.
Ramaphosa’s political future was cast into doubt on November 30, when the panel delivered a scathing assessment of his handling of the theft of at least $580,000 that had been stashed in a sofa at his game farm.
More than half the National Assembly’s 400 members rejected the findings on Tuesday, scuppering a potential impeachment inquiry.
Ramaphosa didn’t break any laws and there is no case for him to answer, Pemmy Majodina, the party’s chief whip, said during a debate on the report.
“Credible evidence should be presented for impeachment,” she said.
The rand extended its earlier gains and was 1.7% stronger at 17.2893 per dollar by 5:27 pm in Johannesburg. The yield on the benchmark 10-year government bond fell 14 basis points to 10.94%.
“The ANC’s decision not to move ahead with impeachment proceedings against Ramaphosa is a net positive for South Africa’s financial markets and the rand,” said Brendan McKenna, the New-York based emerging markets economist & FX strategist at Wells Fargo Securities.
“Keeping Ramaphosa in office at least keeps his reform agenda on the table, which I think is something the economy needs and can provide long-term benefits to the economy if implemented.”
Lawmakers from the ANC, which has 230 seats in the assembly, were first to cast their ballots.
While the party’s top leadership had instructed them to reject the report, just five who oppose Ramaphosa defied the order and a handful of others abstained.
Those who voted against the president included Cooperative Governance and Traditional Affairs Minister Nkosazana Dlamini-Zuma, who narrowly lost to Ramaphosa in the contest to lead the ANC in 2017, along with Mosebenzi Zwane, a former mines minister, and Supra Mahumapelo, a former premier of the North West province.
The sitting was held in the Cape Town city hall because the National Assembly chambers were gutted by a fire in January and have yet to be repaired.
Lawmakers from all the main opposition parties voted in favour of adopting the report.
“There are big questions that remain unanswered,” said John Steenhuisen, leader of the main opposition Democratic Alliance.
“Our country cannot afford the turmoil of a president that is fighting for his political life and his skin.”
Ramaphosa is widely expected to win a second term as ANC leader at its December 16-20 national conference after receiving the most nominations for the post, and the vote reinforced his status as the front-runner.
The party has held power since the racist system of apartheid ended in 1994, and whoever is chosen as its leader will also be its presidential candidate in a 2024 general election.
The furor embroiling the president erupted in June, when Arthur Fraser, the nation’s former chief spy, laid charges against him, alleging that he tried to cover up the theft of at least $4 million from his farm in the northern Limpopo province.
The source and accuracy of that information remains unclear. Opposition parties questioned whether the president had broken foreign-exchange and tax rules.
Parliament appointed the advisory panel headed by Sandile Ngcobo, a former chief justice, to investigate the matter.
It disputed Ramaphosa’s assertions that the stolen cash came from the sale of 20 buffalo to Sudanese businessman Hazim Mustafa and that his farm manager decided to hide it in a couch because he thought that was the safest place to keep it.
While Ramaphosa initially contemplated resigning, he later backtracked and said he will challenge the panel’s findings in court on the basis that they’re legally flawed.
He’s consistently denied any wrongdoing. Mustafa confirmed in an interview with Sky News that he’d bought the animals through an agent, but never took delivery because of the coronavirus pandemic.
Ramaphosa isn’t necessarily off the hook despite having escaped parliamentary censure. The police are also investigating the matter, and under ANC rules he’ll have to resign if he’s criminally charged.
A former labour union leader and one of the wealthiest Black South Africans, Ramaphosa succeeded Jacob Zuma in early 2018 and pledged to tackle the corruption and economic malaise that set in during his predecessor’s nine-year rule.