Zuma no confidence vote will fail whether it’s secret or not: analysts
Political analysts, foreign investors and local investors have little hope that the motion of no confidence against president Jacob Zuma scheduled for next week will pass – whether a secret ballot is granted or not.
A survey conducted by research analysts at Nomura polled 42 local investors, 52 offshore investors and 12 political analysts on the probabilities of Zuma getting the boot next week.
The responses varied among each group, Nomura said, with political analysts emerging as the most pessimistic in the bunch, and investors, both local and abroad coming through as the most hopeful.
However, one thing was clear among all responses: there is not much hope that the motion will pass under any conditions.
Probability of a secret ballot being offered
Looking at the ranges, political analysts had the lowest range of certainty of a secret ballot being possible, Nomura said, averaging around at 20% likelihood that Speaker of the National Assembly, Baleka Mbete will grant a secret vote.
Foreign investors were most optimistic about this, with a range between 20% and 60% probability (averaging 35%), while local investors were only slightly less sure.
Probability of success if secret ballot it used
Even if a secret ballot is granted, though, not one respondent saw the possibility of the motion passing at above a 45% probability. Most predictions put it between a 25% to 30% chance at best.
Probability of success if open vote
Probabilities for success of the motion under an open ballot were all significantly lower with foreign investors around 10%, local investors around 5% and political analysts’ modal view of no chance of it passing.
The bottom line – the absolute chance of success
Looking at the absolute probabilities of the motion passing local and foreign investors are in line with Nomura’s predictions at around 14%.
Political analysts are lower still with a 7.5% chance, while local investors seem to have the widest range of uncertainty over the outcome – maybe hinting at a mix of more volatility in local media headlines and the influence of a little hope into the mix, with foreign investors and political analysts lower, Nomura said.
“The low probabilities from investors show the strong upside for South African assets if the motion succeeds, especially if under an open ballot, but if priced into the market the limited downside for South African assets that might exist after the vote fails.”
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