ANC could lose ‘several important cities’ in 2016

Moody’s Investors Service has warned that the ruling party, the African National Congress (ANC) could lose several ‘important’ cities in the May 2016 local elections.

On Tuesday, Moody’s affirmed South Africa’s Baa2 government issuer ratings and changed the rating outlook to negative from stable.

It cited two main drivers:

  • Increased probability that growth will remain low for a prolonged period of time due to the structural challenges facing the mining industry and other sectors of the economy; and,
  • Rising risk of fiscal slippages in the face of both slower growth and increasing political pressures.

Moody’s said that one additional source of political pressure is the upcoming local elections in May 2016.

“Moody’s notes that while the South African government is not known for ramping up spending ahead of elections because of its disciplined fiscal framework, the potential for losses of several important cities represents a deeper challenge than the ANC has faced since the democratic transition in 1994.”

It is widely reported that the ANC can expect very competitive races in the City of Johannesburg, Tshwane and the Nelson Mandela Bay metropolitan municipalities
in 2016.

Recent data showed that public disapproval ratings for the ANC has increased significantly since 2011 under president Jacob Zuma, with particular concern in economic capital of Gauteng.

The ANC admitted in August, in an internal discussion document that it has concerns about its waning support, following the general elections in May last year.

From the last two national elections, the ANC has shed support, coming down from 69.7% in 2004, to 65.9% in 2009 and 62.2% in 2014, it said.

ANC membership has also dwindled from over one million to just above 789,000 over the last couple of years, president Jacob Zuma said at the party’s national general council (NGC) in October.

According to the Institute for Security Studies, when taking into account the increase in the population of voters in 2014, the ANC votes were down more than 20% in Joburg.

change in votes

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ANC could lose ‘several important cities’ in 2016