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Jacob Zuma, the embattled leader of South Africa’s ruling African National Congress (ANC) launched a big fight for his political life on Aug. 4, asking the Pietermaritzburg High Court to dismiss a graft case against him that could stop him becoming president next year. If his application is rejected, a full corruption trial could follow later this year and South Africa could head into a protracted period of tension and uncertainty. Read the following insights from leading analysts and have your say on how the legal process could affect South Africa:
Keith Gottschalk, the University of the Western Cape (see full analysis)
“Jacob Zuma’s Zuma’s legal team has already proved, year after year that, if you have a bottomless pocket such as taxpayers, you can protract litigation, U.S.-style for the better part of a decade.”
Rainette Taljaard, Helen Suzman Foundation (see full analysis)
“If the arms deal was the loss of innocence for South African’s ruling party, the Zuma trial will be the collateral damage to constitutional structures with long-term consequences.”
Adenaan Hardien, Cadiz (see full analysis)
“If anything is giving market participants sleepless nights, then it has to be what Reserve Bank Governor Tito Mboweni and his Monetary Policy Committee will decide when they meet next week.”
Adenaan Hadien, Cadiz Holdings
Pietermaritzburg may well have been brought to a standstill with the resumed corruption case of Jacob Zuma in the High Court, but I suspect the same would not be true for local markets. Certainly, if last week’s market performances are anything to go by, then reactions are likely to be muted. Last Thursday, the Constitutional Court dismissed all four of Zuma’s appeals to prevent the state from using potentially damaging evidence against him in his corruption trial. On Monday, Zuma’s legal team submitted an application for a permanent stay of prosecution, arguing that his constitutional rights have been violated. This application and the round of appeals which may follow if, as is expected, it was rejected, would again delay things.
On the week, the local currency gained over 4% against South Africa’s trading partners’ currencies and bonds enjoyed gains last seen in the late-1990s. Equities put in a more mixed performance on the week, due to the oscillating woes of resources against financials and industrials. The performances of bonds were even more impressive, given the higher-than-expected consumer inflation figures released on Wednesday. Granted, Thursday’s producer inflation numbers were more encouraging.
Raenette Taljaard, Helen Suzman Foundation
ANC President Jacob Zuma’s quest for a pre-trial stay of prosecution looks certain to perpetuate uncertainty and an uncomfortable ongoing holding pattern and turmoil inherent in these dramatic events.
These compounded uncertainties do not only affect the South African economy with perceptions of political risk ratcheting up as key members of the new ANC leadership step up the rhetoric as Zuma goes to court but also creates tremors for core constitutional institutions and the bench in South Africa. After upholding the search and seizure warrants used against Zuma and rebuking his legal team for what amounts to delaying tactics, the Court also discouraged pre-trial legal wrangles of the kind that started in Pietermaritzburg.
Keith Gottschalk, The University of the Western Cape
The Presidency currently has a line item budget of 10 million rand per year for Zuma’s legal expenses. By South African standards, this is a record. It will certainly enable his legal team to appeal every point of procedure, then if necessary the verdict, and sentence. Each appeal starts with a delay of six or nine months on the court rolls, repeated as it winds it way upwards through a full bench of the High Court, followed by the Supreme Court of Appeal, followed by the Constitutional Court.