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Zuma survives and emerges stronger - economist

Apr 05 2017 15:31
Liesl Peyper with Bloomberg

Cape Town – Now that President Jacob Zuma has survived another attack on his leadership, the only other option left to have him removed from office is a no-confidence vote in the National Assembly.

News24 reported Zuma has won the day after a special extended ANC National Working Committee (NWC) meeting rejected calls for him to step down.

Three top ANC officials - Deputy President Cyril Ramaphosa, secretary general Gwede Mantashe, and treasurer general Zweli Mkhize - have accepted that they made a "mistake" by publicly criticising Zuma following his Cabinet reshuffle.

"Officials had a candid report on serious issue disagreements, it was a mistake that must not to be committed again," Mantashe said at a press briefing on Wednesday.

The party members who attended the NWC meeting had also accepted that Zuma's broken relationship with former finance minister Pravin Gordhan was enough reason for him to fire him.

"NWC accepted that the irretrievable breakdown of the relationship was sufficient explanation between the president and members of Cabinet, [the] issue of an intelligence report complicated the matter," Mantashe said.

The NWC meeting included provincial chairpersons and secretaries, and was said to be dominated by Zuma supporters.

READ: Top ANC leaders 'made a mistake to differ over cabinet reshuffle'

Opposition parties, however, are pushing for Parliament to reconvene earlier than scheduled so that a no-confidence motion can be put before the National Assembly. 

READ: Zuma ignores junk status, praises Gordhan's maturity 

The Democratic Alliance, the Inkatha Freedom Party and the United Democratic Movement among others requested to schedule a sitting for the motion to take place. Parliament is currently in recess and reconvenes on May 2.

Nomura emerging market economist Peter Attard Montalto however believes Zuma will survive another no-confidence vote. 

“We see him emerge from the parliamentary processes (like the meeting with ANC leadership structures) with strength and full power to implement his agenda.” 

How a no-confidence motion works 

For a no-confidence motion to succeed, 201 votes (50% plus one of total membership) must vote in favour of the motion. 

National Assembly Speaker Baleka Mbete said on Sunday she would apply her mind and consult with Deputy President Cyril Ramaphosa (who is the leader of government business in the National Assembly) and ANC Chief Whip Jackson Mthembu. Both are perceived to be anti-Zuma. 

“A no-confidence vote would see most opposition parties voting together and maybe one or two smaller ones that in reality are strongly aligned to the ANC (and Zuma especially) voting against it," Montalto said. 

“We would see the ANC achieve a majority against the motion with maybe 210 votes or so, with a chunk of 30 ANC members of Parliament probably abstaining. It is possible that we could see a simple majority vote for no confidence if there are a larger number of abstentions by ANC MPs, but this would not pass under the rules of the National Assembly and the Constitution."

Past no-confidence motions 

During the no-confidence motion on March 2016, it was defeated with 225 votes against the motion and 99 in favour, with 22 active abstentions (people voting “present” but neither for nor against) and 54 passive abstentions (people not present in the National Assembly, including the Economic Freedom Front). 

On November 10 2016, there were 214 votes against the motion, 126 for the motion (with EFF voting this time), one active abstention (from a small party) and 59 passive abstentions (mainly ANC members and smaller parties).

READ: Baleka Mbete considers motion of no confidence 

“We see opposition parties gaining around 60-odd votes in favour of the motion as unlikely,” Montalto saids. “The lack of secret ballot would ensure transparency and compliance with any NEC directive. A secret ballot would be technically possible if the National Assembly voted in favour of it. Nevertheless, we believe (contrary to the recent statements of the speaker who said simply it’s not in the rules) a secret ballot vote is unlikely to succeed.” 

Although Zuma has taken a meaningful risk by removing key ministers - such as Pravin Gordhan and Mcebisi Jonas - from the finance ministry last week, his move reflects a “calculated risk”, Montalto said.

"He understands the level of support he has in key ANC bodies, Parliament and he is executing a well-planned strategy. Put another way: is President Zuma being politically naïve, or is he a master tactician who can play the internal machinations of the ANC? We believe the latter.”

The role of NGOs and civil society

Montalto believes the the role of civil society organisations is “overplayed”, given limited impact on the internal workings of the ANC.

“Ultimately the reversal that was Nenegate (when former finance minister Nhlanhla Nene was fired on December 9 2015) was caused by a market shock that fed through to the ANC via business leaders connected to the party. That market shock has not happened really this time to such a degree,” he said.

“Indeed, much of the protest action appears small, though the real test will be this Friday’s marches to the Union Buildings. We watch for large numbers but falling well short of what we call the Brazil level (which is 500 000 people, in other words, the same proportion of the population as turned out in the streets in Brazil in recent times).

"Violence against protests from the Zuma faction supporters is also a risk to watch out for.”  

READ: Roussef to survive Brazil protests, economy to suffer

Montalto said a clearer differentiation is required between protest movements which are “inside the ANC” – therefore factions of the ANC and party-political; and ones “outside the ANC” – more independent. 

“Save SA, for instance, should more appropriately be termed ‘Save the ANC’ and is a factional movement within the ANC. It appears that the organisation’s main goal is not save the country but to save the party from electoral defeat in the long run.”

Montalto said Nomura “struggles” to find black-led, non-party political, truly independent protest movements in South Africa that are of any “decent size”.

“This is partly, again, why we see the chances of a Zuma exit as contained. We believe that protest movements that are factional within the ANC can too easily be dismissed by the Zuma faction within the ANC.” 

The rand suffered another blow on Wednesday, losing almost 40c to the US dollar on news that Zuma has survived calls to resign by members of the ANC.

READ: UPDATE: Rand hits R13.85/$ as Zuma survives call to quit

Shortly after noon the local unit was trading at R13.85/$, from an intraday low of R13.42 and R13.49 just before news broke that Zuma would not be asked to resign.

At 15:50 the rand was trading at R13.75/$.

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