SA outlook for 2012

After a politically and economically somewhat stormy 2011, some commentators are predicting even heavier storms on all fronts for 2012. While this is quite possible, even likely, for some issues, others may be settled without serious fallout or even be non-starters for drama. We give our best guesses (for informed guessing is the best there is) of some of the more important anticipated developments and events ahead in 2012 for South Africa and the region.

ANC centenary

The political agenda is likely to be overshadowed by the African National Congress’ centenary celebrations which kicked off this past weekend with much fanfare.  The centenary year will culminate with the ANC’s national elective conference in Bloemfontein in December.

In his speech president Jacob Zuma pledged much attention to modernising the ANC, ending factionalism, returning to traditional core values, and re-instilling discipline in the organisation. However, he again disappointed by providing no details.

The ANC faces multiple challenges, including a potentially harmful leadership election struggle, policy battles, factionalism, the ongoing challenge by the ANC Youth League, and ill discipline. As government it also faces multiple challenges like high poverty levels, a 25% unemployment rate, land reform issues, rural development issues, slowing economic growth, and more.

State of the Nation Address

President Zuma will deliver his State-of-the-Nation Address on Thursday, 9 February  when he opens Parliament. As per usual, important policy matters and challenges facing government will be dealt with. Expect the following to feature: likely economic developments; job creation and unemployment; poverty alleviation; the National Health Insurance scheme; land reform; the environment and green economy; crime; and regional developments.

Budget

On Wednesday 22 February Finance Minister Pravin Gordhan will deliver his Budget Speech and table his Budget. It is likely to be informed by South Africa’s ongoing slow recovery from the recession, pressures affecting growth and job creation, and the fall-out from the European crisis. Expect Gordhan’s efforts to address unemployment and growth to elicit a negative reaction from the ANC’s major ally, the Congress of SA Trade Unions (Cosatu). Gordhan will probably have to turn to previously avoided methods and resources to balance the state’s books as he already hinted at. It likely will make for unpopular decisions on more than one front and some political tensions may follow.

Medium-Term Budget Policy Statement

The mini budget follows on November 23 to make adjustments to the February budget, adjust growth targets and cover the period ahead. A number of economists believe growth expectations will have to be adjusted downwards during 2012.

ANC National Conference

The ANC’s five-yearly  national conference in December will ratify policy decisions adopted at its policy conference and elect a new broad national leadership. Expectations generally are that the conference will be even more volatile than the 2007 conference at which former President Thabo Mbeki was ousted, and that some serious power struggles may develop.

However, a year can be an eternaty in politics and much can change before the December conference.

Apart from some possibly tense challenges for the presidency (see below) the ANC Youth League (ANCYL), backed by so-called “nationalists”, is likely to seek the removal of Gwede Mantashe as secretary-general and replacing him with former Youth League president and current Sports Minister Fikile Mbalula.

Next SA President

The national conference will give an indication of who South Africa’s next state president might be. At present it seems president Zuma is consolidating and strengthening his own position and is the party’s strongest candidate for the position. However, Zuma himself has yet to indicate publicly whether he will be available for a second term.

The ANCYL and centre-right “nationalists” in the ANC, including many associated with the new business elite want to push Zuma out and replace him either with current Deputy President Kgalema Motlanthe as an interim measure, or with BEE mogul and current Human Settlements Minister Tokyo Sexwale.

If Motlanthe is elected, this group is likely to push for Sexwale to be elected as deputy president to be elected as president next time round. However, neither Motlanthe nor Sexwale have yet publicly indicated that they will be available for election.

Businessman Cyril Ramaphosa may also be an outside candidate for either position, though he himself has not said so.

Should the organisation decide to elect its first-ever woman president, possible candidates include national chairperson Baleka Mbete, deputy secretary general Thandi Modise, Defence Minister Lindiwe Sisulu, ANC Women’s League president and Basic Education Minister Angie Motshekga and Home Affairs Minister Nkosazana Dlamini-Zuma. The latter, however, is seeking to become the chairperson of the Commission of the African Union this year.  None are, however, strong or obvious candidates for the presidency at present.

Youth League

The tensions between the senior ANC and its Youth League, and between president Zuma and suspended ANCYL-leader Julius Malema will be brought to a head this year. Zuma has promised a clampdown on poor discipline and returning the organisation to its core values, a veiled warning to the Youth League.

Malema’s suspension is likely to be upheld in the present appeal process, especially as he has consistently continued to defiantly challenge the ANC leadership. The Youth League in turn could find itself reduced to a desk instead of a league, and/or could later this year find itself with an imposed interim leadership.

Policy Conference

The ANC’s national policy conference – always held before a national elective conference – convenes from 26 to 29 June. A number of far-reaching policy interventions are likely to be adopted, including policy decisions on possible forms of nationalisation of the mining industry or part thereof, and possibly other economic assets. A research document is currently circulating in the ANC for discussion and will lead to a policy paper for the policy conference  to be finally formulated for submission to the national conference in December or rejected. From the national conference proposals may go to government and the legislative process in Parliament, finally resulting in legislation.

Outright nationalisation is highly unlikely to be entertained, but in line with global trends and developmental aims, greater state intervention should be expected.

The policy conference will most likely also deal with other economic policy issues including inflation-targeting and currency control; land reform; labour regulations and job-creation; and poverty.

Judiciary & Media

Recent tensions between the executive branch of government and the judiciary and the media, are also likely to continue this year, especially when the ANC tries to pass the controversial Protection of State Information Bill, having already passed through the . National Assembly. Various senior ANC leaders have recently been warning the judiciary, especially the Constitutional Court, to back off from what is considered the political terrain controlled by the executive. Both might lead to some constitutional battles.

National Health Insurance

Implementation of South Africa’s National Health Insurance scheme will go ahead this year with the launch of pilot projects in 10 districts at an estimated cost of R125bn escalating to R214bn by 2020. The plan is designed to provide universal healthcare access to all South Africans. Its high cost, the unaddressed current poor state of public health services, and possible negative effects of the NHI on private healthcare has been criticised by some, while others have praised the fact that many previously excluded South Africans will be able to access good healthcare for the first time.

Arms Deal Inquiry

The Commission of Inquiry into South Africa’s controversial 1999 arms procurement packages, known as “the arms deal”, will commence this year and will last up to two years.

Corruption

In tandem with the arms deal inquiry and other inquiries – most notably those into lease agreements entered into for office space for the SA Police and various tender contracts issued by Limpopo government departments – the eradication of corruption will be high on the agenda this year. Cosatu will again be exerting maximum pressure on government to address the high incidence of corruption.

Police & Crime

Although police’s crime statistics in recent years have shown some improvements, high levels of scepticism over the accuracy of these statistics remain. Even if the improvements are real, crime levels remain very high with negative impacts on the economy. Meanwhile the government will be hard-pressed to improve police management and leadership, morale, training and working conditions, what with one national commissioner in prison and his successor suspended while under investigation. The government will also have to deal with runaway police brutality, violence and criminality that is eroding public confidence in the police.

Provinces

The future of the nine provinces is likely to come under scrutiny again following the intervention late last year by national government in the affairs of three provinces – Limpopo, Gauteng and Free State. Previously it has had to step into the Eastern Cape as well.

At a previous ANC policy conference some delegates pushed for a revision of the current system of provinces and some ministers have made statements suggesting changes. However, changing the system will not be easy, needing Constitution changes while  many well-paid ANC cadres will have to be employed elsewhere. The ANC’s provincial structures will also be reluctant to give up the power they enjoy via provincial governments.

Local Government

More public protests against poor service delivery can be expected around the country. While the government claims it has progressed well with its municipal turnaround strategy, little progress is perceived on the ground. However, some improvement may well follow the process of quiet removal and replacement of unwanted/unqualified councillors in certain areas. However the state of local government remains one of government’s most serious challenges.

Zimbabwe

On the foreign affairs and Southern African Development Community front developments in neighbouring Zimbabwe will weigh heavily this year. The 87-year-old President Robert Mugabe has just been re-endorsed as his Zanu-PF party’s presidential candidate. Mugabe continues to call for elections this year. But first a new constitution, still in the process of being drafted, has to be approved. However, Mugabe’s health – he was unable to travel to South Africa for the ANC’s centenary celebrations – is a factor in the equation that could send developments in any direction.

Southern Africa

Other countries that will most likely present regional challenges this year, include Angola (presidential elections), Madagascar (elections and ousting an illegal president), Malawi (serious economic and political pressures), Swaziland (serious economic and political problems) and Botswana (first-ever serious challenges to the ruling party and its president).