Political tension is likely to peak again in 2020, as the ANC heads towards its national general council (NGC) and the economic situation in the country remains challenging.
While 2019 marked the erosion of goodwill towards President Cyril Ramaphosa’s administration, 2020 will be a year of intense political contestation between factions in the ANC, as well as between Ramaphosa and his allies in the SACP and trade union federation Cosatu.
This is set to play out against a backdrop of further economic decline, with a downgrade to junk status by ratings agency Moody’s potentially on the cards after the February budget. Then there’s the prospect of further load-shedding, and a continuation of the crisis at Eskom as unions buck against attempts to unbundle and reform the ailing state-owned entity (SOE).
Analysts predict that Eskom will be the single biggest risk to the political economy in the year ahead.
For Standard Bank political economist Simon Freemantle, Eskom and other operationally and financially troubled SOEs present the "most pronounced risk to the country’s political and economic outlook in 2020".
But beyond this, there are key political battles set to play out within the ANC — battles set to affect SA’s political terrain as well as its attempts at economic recovery.
"A number of ANC elections — for instance for new leadership of the ANC Youth League, and the scheduled ANC provincial leadership in Mpumalanga and the North West — as well as the party’s mid-term NGC may distract the attention of the ruling party’s senior leaders from the vital task of economic recovery," Freemantle says.
The year starts with the ANC’s anniversary statement this weekend — but there is little hope for fresh insight or thinking, writes analyst and former party stalwart Raymond Suttner on news website Polity.org.
"What has happened is that the ANC has slipped into decay and, in such an environment, there is little value placed on debate," Suttner writes. "The culture of ideas has disappeared. The ANC is preoccupied with remaining the ruling party and battling over positions."
In 2020, the governing party will once again find itself embroiled in the factional fights that have weakened it considerably since 2005. In fact, the year may usher in another "coalition of the wounded" to take on Ramaphosa’s administration.
The ANC has slipped into decay and, in such an
— Raymond Suttner
environment, there is little value placed on
debate
In the dying months of 2019, the National Prosecuting Authority (NPA) began its long-awaited move against those facing allegations of state capture and corruption. Its opening gambit was the arrest of ANC MP and national executive committee member Bongani Bongo for allegedly attempting to bribe an evidence leader for parliament’s 2018 inquiry into state capture at Eskom.
The NPA is expected to continue its march, with predictions that the first six months of the year will usher in a "period of reckoning" for those at the forefront of state capture and corruption. This may include action against ANC secretary-general Ace Magashule, as well as senior EFF leaders for their role in the VBS Mutual Bank "heist".
The political fallout of such a reckoning is likely to be intense. The EFF has already started aligning itself with the "fightback" faction against Ramaphosa in the ANC, and this is likely to intensify. But the difficulty for this group is that, unlike in 2005, when interference in the workings of the NPA grew considerably, there is no such meddling in the institution under newly appointed head Shamila Batohi.
"Of course, there are always political risks to any thorough accountability process but Ramaphosa has, to a great extent, shielded himself from them by following a rigorous due process approach in rebuilding the credibility of various governance institutions that make up the state’s anticorruption task team," says Freemantle.
"Batohi’s appointment as national director of public prosecutions is a case in point in this regard. In appointing an independent advisory panel to guide his decision, and by then following the recommendation of the panel (which held an open series of interviews), the president has weakened any potential argument that his selection of Batohi was inspired by his ambition to use the NPA to target his political adversaries."
While a coalition of the wounded may attempt to cry politics as they face the consequences of their actions, the SA public is less likely to buy this narrative, given deep and widespread anger and frustration over corruption.
The commission of inquiry into state capture is set to apply for an extension at the end of February, to allow it to continue its work until the end of the year. Commission chair and deputy chief justice Raymond Zondo has told the FM that, provided the court grants the extension, his final report is expected to be ready in December 2020.
The ANC’s NGC — its mid-term policy gathering, set for June — is likely to be the highlight of the political year. This meeting will provide a true indication of whether Ramaphosa has consolidated his support in the ANC, as the fightback faction is likely to challenge him on the implementation of resolutions such as land expropriation without compensation and the nationalisation of the Reserve Bank.
While there has been much noise about the faction attempting to oust the president at the NGC, it’s unlikely to do so — the NGC is not constitutionally designed to take such a decision. Besides, there are also signs that Ramaphosa has been shoring up support among key power brokers in the party — evident in his closer relationship with his deputy, David Mabuza, since last year.
"It is likely that the NGC will heighten the focus on some of the more contentious ANC policies that were endorsed at its previous elective conference in December 2017, in particular the proposals on land [expropriation without compensation] and Reserve Bank nationalisation," says Freemantle.
"This may unsettle some investors in the first half of the year, though concerns will be less pronounced than they were last year, given the president’s firm commitment to protecting the Reserve Bank’s independence, and the various, and predominantly pragmatic, land reform processes that have since been initiated."
The NGC will be a key moment for Ramaphosa, as it is set to either weaken him ahead of the next ANC elective conference in 2022 or cement his authority in the party.
The ball is already rolling on policy processes such as the amendment of section 25 of the constitution (the "property clause") to give effect to land expropriation without compensation. On December 6 parliament’s ad hoc committee on the matter called for written submissions on the draft bill to amend the constitution.
Relations between the ANC-led government and its allies in Cosatu and the SACP are set to come under severe pressure in the year ahead.
Cosatu-aligned unions are gathering support to protest outside parliament when finance minister Tito Mboweni delivers his national budget in February. The budget is likely to contain wage freezes for public servants, given the urgent need to rein in the public sector wage bill.
Cosatu’s largest affiliate, the National Education, Health & Allied Workers’ Union, has already launched a campaign to this effect.
Spokesperson Khaya Xaba has confirmed that the union will be heading to a bargaining conference in March or April, where it will strategise its approach to the crucial 2020 round of public sector wage negotiations, set for the second half of the year.
The wage talks will be a key test of Ramaphosa’s political resolve to deal with the wage bill — the single largest strain on public finances — given that Cosatu and its affiliates were the strongest backers of his successful bid for the ANC presidency in 2017.
Ramaphosa’s administration is already on a collision course with unions at Eskom — the Cosatu-aligned National Union of Mineworkers, and the National Union of Metalworkers of SA — over independent power producers, the unbundling of Eskom, and the appointment of André de Ruyter as CEO of the power utility.
The SACP and Cosatu will continue to push for a reconfigured alliance with the ANC, but there has been little progress towards this since Ramaphosa’s election in 2017. The ANC is also unlikely to bow to demands from its allies in this regard — particularly after the SACP at a special congress late last year once again put on ice its repeated threat to contest elections independently of the governing party.
Opposition party the DA also has a critical year ahead: it’s set to hold a crucial policy and elective conference in the first five months of 2020.
The tumult in the party is unlikely to end, with suggestions of a splinter party being formed by former Joburg mayor and DA member Herman Mashaba and former DA leader Mmusi Maimane.
Though 2020 will be a tough political year, it is likely to settle a number of key questions ahead of another crucial local government election, in 2021.
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