South Africa Election

Synopsis:

• South Africa’s May 29 election features a record 31 parties, with nearly 28 million registered voters and 15,000 candidates wying for 887 seats. The ruling ANC is expected to fall short of 50% support due to socio-economic issues, despite President Ramaphosa’s popularity.

• The opposition has united under the Multi-Party Chartor, led by the Democratic Alliance (DA), which promotes free market reforms, The ANC also faces competition from the Economic Freedom Fighters (EFF), advocating nationalization and land redistribution, and the newty formed leftist uMkhonto we Sizwe (MK) led by Jacob Zuma, who is barred from running.

• Economic challenges include low GDP growth, high unemployment, and infrastructure problems. The SARB projects slight economic improvement, but analysts predict continued struggles due to weak consumer spending and power shortages. Inflation remains above target, affecting consumer demand.

• The economy has suttered from six major shocks, including the pandemic, war in Ukraine, civil unrest, and local crises like flooding and power shortages. Crime costs the economy significantly, with corruption and unemployment being major voter concerns.

• The election could result in the ANC losing its majority for the first time, potentially leading to a coalition government. Investors prefer a coalition with the DA for economic stability, while an ANC-EFF alliance could cause market instability and investor flight.