As the 100-day mark of the Cyril Ramaphosa era approached last May, we decided our clients needed a firmer, more reasoned basis for assessing the new president. What I then described as "unrealistic Ramaphoria" was evaporating as fast as Julius Malema could say "expropriation without compensation". It was being replaced by an "unreasonable Ramapessimism".
We [The Paternoster Group, a risk consultancy agency] asserted that between these two extremes, a more rational basis could be found for measuring Ramaphosa’s performance. Over 10 editions of Cyril Watch, Paternoster has awarded a mark out of 10 for each of 15 indicators — one mark for each green light, half a mark for amber and zero for red.
On this basis, Ramaphosa scores 62.30%. If he were one of my students, I’d probably say he deserved an upper-second and that a lower-second was a bit hard on him.
But it was a tough exam that posed demanding questions.
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The area where Ramaphosa has made the most profound impact is in restoring at least some level of normality and integrity to the highest position in public office — SA now seems to have a serious-minded political leader of serious intent. There is a lone amber light in November 2018 on the back of revelations about a large donation made by Bosasa to Ramaphosa’s 2017 ANC election campaign, which he subsequently handled reasonably well — though he would certainly now be losing further marks for the botched handling of the Bosasa contract with his son, Andile, that emerged recently. Other than that, it has been green lights all the way.
Providing policy cohesion and strategic direction — is the government facing and making the tough choices? Score: 65%.
Amber has been the predominant colour on policy and strategic direction over the past year, demonstrating the delicate balancing act Ramaphosa has had to perform. He has had to pursue some much-needed policy reform while not antagonising his main opponents within the ANC. Significant compromises have had to be made on land reform and the mining charter. But key governance and accountability legislation has been signed by Ramaphosa in the past year, including the Political Party Funding Act that will require parties to disclose private donors, and the Public Audit Amendment Act, giving the auditor-general more teeth in cases of irregular public-sector expenditure.
• Managing competing interests from stakeholders within and outside the government — does the president have enough support for his reform agenda? Score: 50%.
There are 10 amber lights out of 10 for this indicator over the past year, and it’s easy to see why. Ramaphosa has failed to convince large sections of the labour force of the long-term advantages of his reform programme. Assuming the ANC wins the election, the president will have to turn these lights green rapidly if his reform agenda and prospects for economic growth are to have longer-term credibility. Come winter, with an election victory behind him, Ramaphosa may have to face a Thatcherite moment of truth he cannot afford to shirk or lose a series of battles over a simple yet profound question: who runs the country?
• Stability in state-owned enterprises (SOEs) — is the government dealing effectively with the financial and leadership crises of SOEs? Score: 95%.
Despite the dark cloud cast by Eskom’s crisis, which has deep and complex roots, Ramaphosa deserves top marks for his approach to SOE reform. He quickly purged the SOEs of underperforming Zuma cronies and within months, there were significant leadership changes at the SA Revenue Service (Sars), Denel, Transnet, the Passenger Rail Agency of SA (Prasa) and Eskom. While this may take years to bear fruit, the president acted bravely and decisively in placing the SOEs on a better course. More of the same will be needed after the election, especially to unbundle Eskom.
• Cleaning up the criminal justice sector and empowering Chapter 9 bodies — are key prosecutorial and accountability institutions now fit for purpose? Score: 85%.
At the time of our first Cyril Watch, the National Prosecuting Authority (NPA) was in limbo as the country awaited an appeal to the Constitutional Court by the NPA against a high court decision in December 2017, which ruled the appointment of then NPA head and Zuma ally Shaun Abrahams to be invalid. The lights turned amber during this period of uncertainty, but have now turned green. A year on, a respected and seemingly independent prosecutor, Shamila Batohi, is head of the NPA and a new investigatory directorate will boost its capacity. In addition, an inquiry into the fitness to hold office of senior prosecutors Nomgcobo Jiba and Lawrence Mrwebi, both of whom were seemingly put in place to represent Zuma’s interests, is nearing conclusion. As the mark suggests, there has been significant progress here. Though there have been no arrests of politicians implicated in state capture as yet, the NPA is well on its way to pursue these cases when the evidence has been compiled.
• Progress of the Zondo commission of inquiry and prosecutions for corruption/state capture — is the state being fully "uncaptured" after the Zuma years’ ravages? Score: 65%.
The Zondo commission dragged its feet in 2018, and was met with a series of amber and red lights in our Cyril Watch briefings. But green lights have followed in the past six months as the inquiry gathered focus and momentum.
The commissions are laying a foundation for other major reforms. Some have already happened. For example, the Nugent commission was essential to get rid of Tom Moyane at Sars. A new tax commissioner has been appointed — Edward Kieswetter, who has had a distinguished career at Alexander Forbes, Eskom (during its best days) and Transnet. He was also Sars deputy when Pravin Gordhan was commissioner in the mid-2000s. It is a solid appointment after a detailed process, though it has attracted criticism from the EFF in particular — a sign that he is regarded as a tough, competent appointment. Ramaphosa deserves huge credit. Would any of this have happened had he not won the ANC presidency in December 2017?
• Policy lightning rod one: land reform. Score: 25%.
The land reform indicator has flashed red and amber. The economy was hit hard by the 2018 announcement that the ANC would pursue a policy of expropriation without compensation. Ramaphosa and his government have failed to ease investor and landowner concerns — hence, the lowest score of all on this measure. However, he has recovered control of the issue, which is nowhere near the political hot potato it was a year ago.
This is due, at least in part, to Ramaphosa’s deft political handling. The new (sixth) parliament will return to the issue in terms of an Expropriation Bill that sets out a rational framework for expropriation based on due process.
• Policy lightning rod two: the mining sector. Score: 50%.
The 50% score is perhaps slightly harsh on Ramaphosa and his mineral & resources minister, Gwede Mantashe, who have both taken positive steps to restore productivity to the mining industry in recent months. There has been a commitment from the government to ease compliance constraints on mining companies and to tackle syndicates. The lower mark results primarily from delays and criticisms in the process of developing the new mining charter last year and uncertainties resulting from the Sibanye strike. Ramaphosa may breathe a sigh of relief to have come out of this one with a pass mark — though the Mining Council’s legal challenge to the charter has put a new spoke in the wheel.
• Fiscal stability. Score: 45%.
It has been a difficult period on this front. SA was in a technical recession when Cyril Watch began, so the fiscal crisis is not of his making. Though SA has escaped a junk status rating, the fiscal outlook remains far from stable. Moody’s has been reluctant to cause further difficulties for the reform programme’s momentum by downgrading.
• Job creation and economic growth strategies: is there progress, building on the job summit and other processes of 2018? Score: 60%.
Perhaps 60% is a bit generous, given that SA experienced net job losses over all four quarters in 2018 and unemployment and youth unemployment rates are at record highs. On the other hand, much of that is a hangover from the previous administration and due to external global economic factors, and it will take time to see the results of the agreements reached at the presidential job summit. The sluggish economy compounds the unemployment numbers. Ramaphosa insists that it will be investment that fuels job creation, and there has been some progress on this front. A great deal of effort has been made behind the scenes. For example, a group of economists was convened to debate how the government could best address the structural constraints of the economy — one of many parallel consensus-building and "listening processes" that demonstrate Ramaphosa’s determination to draw on the best to solve SA’s problems.
• Forging a new social compact and engagement with social partners: are labour and business sufficiently on board? 45%.
The mark of below 50% mainly reflects organised labour’s drift away from Ramaphosa’s reform agenda in recent months.
There has not been a single green light under this indicator in any of our Cyril Watch editions. While Ramaphosa has a history as a trade unionist, his policies are more market-and investor-friendly than those advocated by more populist-nationalist factions during the Zuma era, and labour’s support for Ramaphosa’s reform agenda may be vulnerable. The unions have opposed plans to raise productivity in the mining sector as well as moves to streamline SOE costs.
• Rebuilding investor confidence and attracting investments: is he shifting market sentiment in the right direction? 75%.
Not a single red light here. Ramaphosa has been on a campaign to attract investment — one of his highest priorities on taking office — and we hear more investor-friendly sentiment and policies from his administration. Ramaphosa has refused to yield to populist forces and remains committed to respecting the market and attracting investment. The results are there to see: foreign direct investment almost tripled in 2018, to its highest point in five years.
The fact that investor sentiment is still highly sceptical belies this trend, and is partly due to a "once bitten, twice shy" reservation on the part of market-makers and fund managers. There is also doubt about whether Ramaphosa will be able to take the hard structural-reform decisions, and impatience at his rate of progress so far.
• Managing factional disputes with key provincial structures of the ANC: is he dealing with the "Zuma factor" and rebuilding unity? 55%.
Last month’s red light, and one awarded in June 2018 after a series of messy ANC provincial conferences, put a blemish on what was an otherwise impressive display from Ramaphosa in holding the ANC together. The main priority for Ramaphosa in his "Monday job" of ANC president was to prevent a significant breakaway faction leaving the party and dragging its electoral support below 50%. This he managed to achieve. The concessions he has made to the Zuma faction frustrate many but achieve their objective. He needs the party united ahead of the May polls, whereafter we may see a more concerted effort from Ramaphosa to rid the ANC of more of its state-capture elements. However, March was an especially challenging month for the president, when the release of the ANC election candidate lists suggested that Ramaphosa’s grip on the ANC is not as tight as it should be. More than 20 people were removed during the vetting process, yet the list includes certain allegedly corrupt high-profile members linked to the Zuma faction.
The list reveals much about the balance of power in the ANC. It shows that the fightback against Ramaphosa continues; that the Zuma state-capture nationalists enjoy sufficient support not only to be nominated but to be placed high up on the list. Though the ANC’s integrity commission was due to look into the matter this week, regardless of what it decides the damage has been done.
• Building electoral confidence: electoral strategy and campaign focus. Score: 60%.
A solid performance here, with no red lights across the 10 editions of Cyril Watch. It really has been all about Ramaphosa from the ANC’s perspective, with the president being significantly more popular than the party itself, and his presence has led the ANC to a series of decent by-election results and reasonably positive opinion polling scenarios as it enters the final furlong of the election campaign.
• Multiparty democracy — how is the ANC coping with challenges posed by other parties? Score: 65%.
Overall, Ramaphosa’s steady performance in managing the threat of opposition parties (helped by DA infighting and EFF corruption allegations and violent rhetoric) has dented both of those party’s election prospects. Despite the damage done by the "lost decade" under Zuma, the ANC remains in pole position to win in May. The only question is whether its victory margin will help or hinder Ramaphosa’s political needs and reform agenda.
Though the jury may still be out, the platform has been laid.
Not a bad record considering the drawbacks Ramaphosa faces
— What it means
Perhaps the right leadership comparison is not to Thatcher but to Thabo Mbeki, who was SA’s president from 1999 until his unceremonious ousting as party leader by the Zuma pack in December 2007 (he stepped down as president in September 2008). Mbeki was skilful and, when necessary, single-minded and rhino-thick-skinned in either ignoring or managing his own party and its conference resolutions. In government, he often just took the decisions he thought were necessary. Exhibit A: the sudden switch from the Reconstruction & Development Programme (RDP) to the Growth, Employment & Redistribution (Gear) programme. Ultimately, losing touch with the ANC cost Mbeki his ANC presidency and prematurely ended his presidency of the country. Ramaphosa will have learnt many lessons from this.
But whether the model is Mbeki or Thatcher, Ramaphosa will have to take similar risks to his undoubted personal popularity and his political ANC future for the longer-term sake of the economy. In addition, he will need brave and skilled investigators and prosecutors to rebuild the NPA as well as a more congenial global economy to provide a tailwind.
But in the immediate term, he needs another strong majority for his divided and deeply troubled party. Then, as a first act of decisive leadership, he will need to appoint a cabinet that is competent and capable as well as politically coherent and loyal — the first indicator of progress in what should properly be regarded as the real start of the Ramaphosa era.
• Calland is a founding partner of political risk consultancy. The Paternoster Group and an associate professor in public law at the University of Cape Town
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