South Africa’s largest trade union federation was quick to break into stirring songs of class struggle during its recent congress and COSATU members showed an impressive ability to sign along in unison.

But the question of what it is fighting for these days and its role in the ruling tripartite alliance with the African National Congress and the South African Communist Party has never been under such great scrutiny as it has since President Jacob Zuma took office in May.

Zuma’s struggle for power would have been much harder to win – perhaps even impossible – without the support of the unions and he was happy to take centre stage at the COSATU conference in a bright red Mao-style suit.

But while ever ready to promise support for fighting poverty, Zuma has shown scant sign of agreeing to union demands for everything from big increases in spending to the nationalisation of the central bank.

Unions are now preparing to do battle over the fate of Trevor Manuel, who won the respect of markets as finance minister for policies that unions see as too pro-business and who now heads a planning commission in the presidency.

As well having little love for Manuel, unions feel his role is undermining one of their own in the government - Economic Development Minister Ebrahim Patel.

But the argument highlights the difficulty for COSATU of being both within a broad government it helped bring to power and trying to then pressure that government for changes in the name of a working class struggle.

The face of the union is changing too. Although the theme of the congress was “Consolidating Working Class Power in Defence of Decent Work and for Socialism”, a steady stream of high end German cars made it easy to spot the way to the conference venue.

During the darkest days of apartheid, COSATU leaders struck fear into the white minority ruled-state - they had the ability to bring the country to a grinding halt and they knew it.

Now their power appears more limited over a government they did as much as anyone to put in place.

Picture: A COSATU member marches in Durban in protest against high prices, August 6, 2008. REUTERS/Rogan Ward

Canada’s decision to grant refugee status to white South African Brandon Huntley has drawn anger from the ruling African National Congress, which described it as racist, and has again stirred the race debate in South Africa 14 years after the end of apartheid.

Huntley had cited persecution by black South Africans as the reason why he could not return to the country of his birth. The chair of the Canadian panel that granted his request said he had shown evidence “of indifference and inability or unwillingness” of South Africa’s government to protect white South Africans from “persecution by African South Africans”.

“I find that the claimant would stand out like a ’sore thumb’ due to his colour in any part of the country,” the chair of the tribunal panel, William Davis, was quoted as saying.

In his application for asylum, Huntley said he had been a victim of multiple crimes by black South Africans and added that white South Africans were a target.

He pointed at the country’s Black Economic Empowerment policies as institutionalised reverse racism that has ensured that he has no opportunities.

The Ottawa Sun described how Huntley first came to Canada to work as a carnival attendant on a six-month work permit in 2004, came back in 2005 and then stayed on illegally until he made a refugee claim in 2008.

Anyone visiting South Africa will certainly see plenty of evidence of white South Africans doing extremely well and generally having a higher standard of living than the majority of black South Africans. White South Africans head many top firms while the highest crime rates are not in the suburbs of the affluent, but in the poor black townships.

Many members of minority groups do complain, however, that they are discriminated against in the Rainbow Nation, led by the ANC since Nelson Mandela took office as president in 1994.

Was Canada justified in giving refugee status to Huntley or was the decision racist? If white South Africans can claim refugee status then who can’t? Is the ANC over-reacting and missing a sign of disaffection by a large minority group?

Have your say.

Eighteen-year-old Mokgadi ‘Caster’ Semenya is being celebrated as a national hero in South Africa after winning the 800 metres at the World Athletics Championships, but the decision by international athletics officials to order a gender verification test has stirred deep anger – and brought accusations of prejudice against the country and the continent.

Many in South Africa feel a victory by their talented young athlete is being tarnished by bad losers and a world all too  ready to mock. Sensitivities to prejudice are never far from the surface in the country where apartheid white minority rule ended just 15 years ago.

South Africans point out that headlines such as “Is she really a HE?”, in Britain’s Daily Mail, and the question of gender verification only surfaced when Semenya started to do much better than her peers.

“It shows that these imperialist countries can’t afford to accept the talent that Africa as a continent has,” the South African Football Players Union said in a message of congratulation to Semenya.

Politicians stepped in too.

“The ANC YL condemns with contempt those who are questioning her gender,” said the ever vocal Youth League of the Ruling African National Congress.

Some even drew parallels between Semenya and an unpleasant episode from the colonial era - Sarah Baartman, a South African woman, was taken from her rural homeland in 1810 and paraded to the world as a freak because of her unusual physical features. Her remains were finally brought back to South Africa in 2002 and laid to rest.

Whatever the results of the officials’ tests on Semenya - and the scientific procedures could take months – most South Africans are convinced that she is not a cheat but a great athlete who will return to a huge welcome.

South African President Jacob Zuma has a tough balancing act to perform as he begins his term in office.

 On the one hand, Zuma is anxious to assure investors that there will be continuity in the economic policies that have secured the country’s status as the regional powerhouse.

On the other, he has to address the increasingly vocal demands of his allies in the labour movement, whose support propelled him first to the leadership of the ruling ANC and then to the country’s top government job after April 22 elections.

But what the unions want - increased social spending to cushion their members against the ravages to the global recession that has now also landed in South Africa - would mean veering away from the prudent fiscal stance that has ironically cushioned the country from the worst of the world crisis.

Investors are also keen to see whether Zuma bows to pressure not to renew the contract of central bank Governor Tito Mboweni, loved by financial markets but vilified by unions that say a pre-occupation with inflation targeting has seen the Reserve Bank maintain a tight monetary policy at the expense of economic growth, impoverishing millions.

Can Zuma please one side without alienating the other? And if it comes down to choice, will the President opt to sacrifice his alliance with the Left to maintain South Africa’s international standing? How essential is union support for his success as President and can the ANC stay in power without it?

Recent events in South Africa have sent some conflicting signals to investors about sovereign risks. On the one hand there was some regulatory flip-flopping over the Vodacom listing given objections from the union organisation COSATU, which raised questions about the influence of unions in Jacob Zuma’s administration. On the other hand the sovereign issuing some $1.5 billion was highly successful and oversubscribed.

With Zuma recently elected on a platform of change for his domestic audience and continuation of old policies when speaking to investors, there is a raft of new ministers and new ministries and quite a bit of policy uncertainty. No foreign investor will deny South Africa’s need to address serious social problems of inequality, housing, jobs and education through a more developmental state agenda.

However investors I speak to simply want to see that this is not at the expense of the productive sectors of the economy. This agenda will naturally involve the ANC’s allies: COSATU and SACP (communist party).  As such, the process of governing will be a noisy affair for investors. I put the Vodacom incident down to such noise.

However I believe the new Zuma administration will find itself heavily constrained by the need to raise funds for its agenda and so keep investors onside as the government’s borrowing requirement balloons. Add state owned enterprises engaging in very necessary investment, and a current account deficit and you arrive at a funding requirement north of  500 billion rand for the next two years.

This will act as a strong rationalising influence though a backup overdraft in the form of an IMF flexible credit lending facility would be a benefit.  It also should not be forgotten that there is still a strong business influence in the cabinet and the ANC from the likes of Cyril Ramaphosa and Tokyo Sexwale.  Most investors buy the case of policy not shifting sharply to the left, though a lot of questions have been planted in the minds of investors.

Keeping the different factions in his cabinet in line will be key for Zuma’s success, especially with two new hurdles looming: the Bharti/MTN and the Xstrata/Anglo American mergers. Both are sensitive and likely to be jumped on by unions.  The inflation-targeting debate is also being reopened locally — a topic foreign investors love to discuss.

It is now up to Zuma and his team to deliver on prudent macro-policy as well as his developmental state priorities in order to sustain the current goodwill from investors.  It is still early days for his administration. We hope not to be disappointed — for South Africa’s sake as much as anyone elses.

Peter Attard Montalto is emerging market economist at Nomura International.

After South Africa’s unions came close to blocking the listing of mobile phone group Vodacom, new President Jacob Zuma may want to keep a closer eye on his left wing allies.

The attempt to sink the $10 billion bourse debut of Vodacom, which went ahead on Monday after an 11th-hour court ruling, hurt the rand currency and revived investor concerns over Zuma.

There was no doubt the bid had undermined Zuma’s strenuous efforts before last month’s election to assure business and investors that there would be no policy shift towards his left wing allies once he took office.

Lawyers for the government opposed union federation COSATU’s attempt to stop the listing in court and made clear the Zuma administration stood by what had been agreed already.

But investors still want reassurance from Zuma that other deals would not face similar challenges by his allies.

COSATU, which has 1.8 million paid-up members in the country of nearly 50 million, said it was angry and disappointed at the court allowing the listing to go ahead and called on South Africans to boycott Vodacom.

But by taking a strong stance on the Vodacom listing, the labour federation may be positioning itself to play a bigger role and could intensify its protest action against other businesses.

Will that be good for South Africa? How successful will the unions be? What will Zuma do about it? What can he do?

South African opposition leader Helen Zille has not endeared herself to the majority of voters who recently handed the ruling African National Congress a landslide victory in the national polls.

Zille came under fire from her political enemies for her appointment of a predominantly white and almost completely male cabinet in the Western Cape, the province where her DA party took power from the ANC.

She retaliated by attacking President Jacob Zuma, calling him a “self-confessed womaniser with deeply sexist views, who put all his wives at risk by having unprotected sex with an HIV-positive woman”.

That referred to Zuma’s acknowledgement that he had such contact during a trial on rape charges of which he was acquitted. The row has ended any suggestion that after Zuma’s election, there might be a period of better relations between the government and opposition.

ANC Secretary General Gwede Mantashe , said Zille has “elevated herself from being the leader of the official opposition to being the enemy”.

Quite apart from the name-calling, the row also looks as though it could distract attention from the opposition’s own efforts to present itself as an alternative to the ANC.

It is not the first time that South Africa’s opposition has found itself caught in a war of words with the ANC rather than showing what it will do differently.

Zille’s opponents say she is still to answer the question over the gender and racial balance in her Western Cape cabinet. Does that matter? What will it mean for her chances of winning over voters from the black African majority, who so clearly backed the ANC in the election? What will it mean for South Africa’s prospects if the government and main opposition are so quickly at each other’s throats?

Making sure South Africans hold their new government accountable is essential if the country is to succeed under Jacob Zuma, believes Mamphela Ramphele, an anti-apartheid activist and prominent South African businesswoman.

“We underestimated what it means to govern a modern democracy,” she told Reuters. “In that context we have made many  mistakes. The first mistake was to conflate the leader, the party, the government and the state. That conflation leads to the undermining of state institutions … and abuse of state resources for party political reasons.”

Ramphele, a doctor and former World Bank official, is among a group of professionals who helped draft three potential scenarios for the country into 2020.

There is a healthy one, of course, in which the government works with business and civil society and is held accountable for its actions and service delivery. After that is one in which the African National Congress government takes a strong role with little opposition - it leads to authoritarian rule. The worst case scenario points to corruption and decay.

Key to success under incoming President Zuma, she believes, is accountability.

“We need to keep the pressure, not pressure to oppose them, but pressure to support, encourage and hold them accountable to deliver on the promises of their election campaigns,” she said.

Although full of complements for Zuma and his abilities, Ramphele also sees positive aspects in the emergence of COPE, the opposition party formed by breakaway ANC members before the election.

She sees is at as a force that will put pressure on the ANC to deliver on problems such as poor education, poverty, the AIDS epidemic and violent crime.

“I can’t imagine any other society with the diversity that we have failing. I can’t imagine any society with the passion that we have as South Africans failing, except if that society refuses to make sure that it’s got leaders that are held to account.”

William Gumede

South Africa’s national elections last week have reshaped the contours of the country’s political landscape. It has almost certainly killed off the careers of many opposition leaders who have become institutions and their parties with them. It virtually obliterated the peer parties of the ANC, with their roots as liberation movements, such as the Pan Africanist Congress of Azania (PAC) and the Azanian Peoples’ Organisation (Azapo). It is clear the electorate believes these parties are irrelevant, outdated and under poor leadership. The Inkatha Freedom Party, whose founder, Mangosuthu Buthelezi also professed that it has its origins in liberation movement politics has also been brought down to size.

 The IFP has dominated the KwaZulu Natal province since the 1960s, but embarrassingly lost out to the ANC now. ANC President Jacob Zuma’s overt appeal to Zulu speakers in the province who have supported the IFP in the past, by arguing that is better to support him (Zuma) for the presidency, and have a Zulu-speaker in the presidency, has evidently worked. Many IFP supporters have voted for Zuma merely on the basis of ethnic affinity, rather than his record in government.

 But this strategy also run the risks of increasing ethnic divisions, with some Zuma supporters already whispering for the ‘Xhosa-Nostra’ to be purged from government. This is a reference to individuals who were allies of former President Thabo Mbeki, are Xhosa speakers or who are from the Eastern Cape province from where Mbeki and former President Nelson Mandela hail.

(more…)

Pledging to work for national unity is pretty much a formality for any election winner, but in the case of South Africa’s Jacob Zuma it may be more than a platitude. It may need to be.

“The new President of the Republic will be a president for all, and he will work to unite the country around a programme of action that will see an improvement in the delivery of services,” Zuma said after the African National Congress won its sweeping victory.

“We may disagree on how to bring about a better life for all, but what unites us is the fact that this country belongs to all of us, black, white, coloured and Indian equally. We will need to work together on issues that are in the national interest, on which there is no need to compete or permanently bicker.”

Despite the strongest opposition challenge since the end of apartheid, the slick ANC campaign delivered the vote and persuaded a majority of South Africans that the party that has ruled since 1994 could also be the one to deliver change – more action against poverty, crime, AIDS and other concerns.

But unity is always going to be tough in a country with as many divisions as South Africa. The formerly monolithic ANC itself split last year after it ousted former President Thabo Mbeki.

The vote clearly showed up the racial divide 15 years after the end of rule by the white minority.

The vast majority of black Africans had clearly voted for the ANC, whose credentials are still strong for ending apartheid. The voters included those in KwaZulu Natal province, where the Inkatha Freedom Party used to be dominant. Zuma, a son of the soil, definitely helped the party win more votes there.

Coloured and white minorities, however, opted heavily for the opposition Democratic Alliance, which won convincingly in the Western Cape province, where they make up the biggest proportion of the population. Led by Helen Zille, a white woman, the Democratic Alliance has had little success winning over black African voters.

Zuma made great efforts to charm South Africans of all colours before the election, making a particular effort to woo Afrikaners. He also appeared to want to make it more of a priority than Mbeki.

But South Africa’s communities still live their lives very much apart, even if the emergence of a growing black middle class means the divisions along wealth lines no longer correlate as precisely with race as they once did.

When he takes office, Zuma will face demands from all sides – from those who want a greater share of the wealth and more opportunities and from those who feel they are politically marginalised. What could Zuma do to unite South Africa? Can he succeed? Does unity really matter for South Africa anyway?

Pictures: A young ANC supporter waves a flag during victory celebrations in Johannesburg, April 24, 2009. REUTERS/Siphiwe Sibeko

Democratic Alliance leader Helen Zille is mobbed by supporters as she arrives at Cape Town’s airport. REUTERS/Finbarr O’Reilly