Ruling ANC loses majority in Parliament

This result marks a precipitous fall for the ANC from the 57.5% achieved in the previous 2019 election – at the time, it was the party’s lowest achievement since the first democratic vote in South Africa in 1994. Long seen as a symbol of liberation, the ANC has been on the back burner. In recent years, the battle against the practicalities of governance has taken a back seat, amid a rise in systemic problems such as such as declining living standards, chronic power outages, the highest violent crime rates in decades and unemployment of nearly 33%. In 2022, the World Bank named South Africa “the most unequal country in the world”.

“The top issues for voters are unemployment, power cuts, corruption and crime, all of which have weighed on the country’s growth for years,” Deloitte analysts said earlier this month.

Unlike party hero Nelson Mandela, who freely formed a power-sharing coalition to ease distrust with rival parties during the early years of South African democracy, outgoing ANC leader Cyril Ramaphosa, 71 years, will have to negotiate a coalition to maintain its domination. a series of negotiations and uncertainties regarding the political direction of the country.

Investors will be watching how this will change the course of South Africa’s economic growth, pegged at 0.9% this year by the International Monetary Fund.

Inflation persists at 5.2% in the latest May figure, above the South African central bank’s 4.5% target, which Governor Lesetja Kganyago said would stabilize in the second quarter of next year. The bank maintained its main interest rate at 8.25% on Thursday.