S. African stocks, rand soar on Ramaphosa’s election
CAPE TOWN — Feb. 15, 2018: Cyril Ramaphosa was elected as South Africa’s president in a parliamentary vote today and pledged to tackle endemic corruption after scandal-ridden Jacob Zuma resigned on orders from the ruling African National Congress.
Ramaphosa faces an uphill battle in revitalising growth, creating jobs and stamping out a culture of graft in a nation
still polarised by race and inequality more than two decades after the end of white-minority rule.
Still, Zuma’s departure late yesterday provided evidence of the strength of South Africa’s democratic institutions, from the courts to the media and the constitution.
Ramaphosa, in brief remarks to parliament ahead of his first state of the nation address expected on Friday, said he would work hard not to disappoint the people of South Africa.
“The issues that you have raised, issues that have to do with corruption, issues of how we can straighten out our
state-owned enterprises and how we deal with state capture (influence-peddling) are issues that are on our radar screen,” he said.
Ramaphosa, 65, was elected unopposed as Zuma’s permanent successor by parliament, and sworn into the post by South African Chief Justice Mogoeng Mogoeng, who had earlier read out the former president’s resignation letter.
The rand, which has gained ground whenever Zuma ran into political turbulence, soared to a near three-year high
against the dollar on word of his resignation.
South Africa’s main stock market index jumped nearly 4 per cent and headed for its biggest one-day gain in more than two years as investors hailed Zuma’s exit after nine years in office rife with allegations of sleaze and economic mismanagement.
Ratings agency Moody’s said it was closely monitoring developments in South Africa, focusing on the policy
implications of Zuma’s political demise.
The S&P Global agency said South Africa’s sovereign credit ratings and outlook will not be immediately affected by the change of the country’s leadership.
Ramaphosa has his work cut out to win back disaffected voters after a string of scandals and policy blunders under Zuma, as well as investor confidence.
But his stated commitment to boosting growth and stamping out graft has gone down well with foreign investors and ANC members who felt Zuma’s handling of the economy could seriously damage the party in the 2019 election.
Africa’s most developed economy needs faster economic growth if it is to reduce high unemployment – currently at 27 per cent, up from around 22 per cent in the year before Zuma first took power – and alleviate persistent, widespread poverty that aggravates inequality and stokes instability.
The economy slipped into recession last year for the first time since 2009 and has also declined in indices that measure corruption and the ease of doing business.
Moreover, the economy remains largely under the control of whites who held power under apartheid. — Reuters