ANC drama means very little for economic reform: analyst
President Cyril Ramaphosa says he was ‘shocked and dismayed’ by a letter from suspended ANC secretary general Ace Magashule trying to use his non-existent powers to oust the country’s leader.
And, while the escalating drama between high profile politicians dominates headlines, it means very little for policy changes or reform within the ruling party, according to Intellidex analyst Peter Attard Montalto.
“Politics is not policy,” Attard Montalto said, adding that the real test for Ramaphosa and the ANC as a whole is what gets done around corruption tied to real economic risks like the energy sector.
“(The) real removal of blockages, such as the urgent firing of Minister Mantashe is the bar. A much bigger test is what Ramaphosa does with energy related corruption,” he said.
Magashule stunned political leaders on Wednesday evening (5 May) by submitting a letter to the president, saying that he was using his powers as secretary general of the ANC to suspend Ramaphosa from the role. This followed the ANC’s National Executive Committee (NEC) and National Working Council (NWC) signing off on Magashule’s suspension.
The SG was ordered to step aside voluntarily by the end of April over corruption charges. Magashule has remained defiant to the ANC’s internal processes that seek to shake off the air of corruption that surrounds that party and some of its high-profile members.
According to Attard Montalto, the suspension of Magashule is a positive move, and one that has been a long time coming – since the fallout of the 2017 Nasrec conference where former president Jacob Zuma and his allies (including Magashule) were defeated in a bid for the presidency.
The impact of the suspension will still be felt, but only at the ballot box during the coming elections, with the move being a net positive for the ANC. In terms of the economy, it has little bearing.
Corruption also does not end with Magashule’s suspension, the analyst said, “though it does start to very marginally increase the stakes for those involved”.
“Energy related corruption issues are ongoing – for instance, coal vested interests etc – which have actually very little to do with Magashule. Our view on rent extraction and vested interest networks operating through government does not shift with the suspension,” he said.
Economic reforms
According to Attard Montalto, the hoopla around Magashule’s suspension and his response and manoeuvring can best be described as “noise”.
“We’ve said it before and it needs to be said again: Magashule was not there blocking economic reforms,” Attard Montalto said. “COSATU, the SACP, and the Ramaphosa obsession with social compacting, were all what has caused the problem.”
The analyst highlighted that two key issues are at play regarding the political blockages for economic reform: mineral resources and energy minister Gwede Mantashe for energy policy, and increasingly negative changes at the Department of Trade, Industry and Competition – the latter of which has Ramaphosa’s full backing.
Exacerbating this, skills capacity, rules, regulations, laws, the constitution and other factors are also major blockages, he said.
“As such this (suspension of Magashule) does not directly or indirectly shift the dial on reforms for us at all – the NEC is asleep on reform issues. They backed the Tito paper without barely reading it. The real bar to reform is removing these blockages – in particular the urgent need for Mantashe to be fired,” he said.
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