South Africa's ANC Loses Its Majority: Possibility of Significant Policy Shifts on the Horizon 

At a Glance

  • On May 29, South Africans headed to the polls in what was widely regarded as the most crucial general election since the dismantling of apartheid 30 years ago.
  • The African National Congress (ANC) is Africa’s oldest colonial liberation movement and is currently under the leadership of President Cyril Ramaphosa. Since the ANC’s rise with Nelson Mandela in 1994, the ANC lost its outright majority for the first time since ascending to power, capturing only 40.18% of the vote. This marks a continued decline after reaching its peak in 2004, with the party securing just 159 of the 400 available seats in the National Assembly – opening the way for a coalition government.
  • A week after the historic election, the ANC announced its intention to form a government of national unity (GNU), which, following extensive discussions, will be composed of nine other opposition parties who have joined to date. Together, these 10 parties, out of the 18 represented in the National Assembly, collectively hold 287 of the 400 seats, accounting for 71.75% of the total.
  • This supermajority sets the stage for potentially transformative policy shifts that could have far-reaching implications for South Africa’s political and socioeconomic landscape. However, since the announcement of the intention to form a GNU, intense haggling over the sharing of powerful portfolios, including the deputy presidency, has threatened to derail the GNU in the short term.
  • The announcement of the GNU was initially met with an overwhelmingly positive response from financial markets, indicating a renewed sense of optimism about the country’s future. The Johannesburg Stock Exchange (JSE) reached a record-high for the year after Ramaphosa’s reinauguration as president, buoyed by the largest rally in SA bank stocks since November 2020.
  • Since the tensions over leadership positions in the new government emerged, the South African markets and currency have fluctuated. 


Overview of the Election 

South Africa’s Electoral Commission (IEC) declared the May general elections free and fair, underscoring the peaceful transition of power to coalition governance as a testament to the country’s resilience and political maturity on a global stage and reinforcing confidence among international stakeholders and investors.

The election results sent a resounding message of discontent to the ANC, which saw its support plummet to 40.18%, a stark 17 percentage point drop from the 2019 elections and the sharpest decline since 1994. This dramatic loss of support is attributed to long-standing issues of corruption, inadequate service delivery, high unemployment, and widespread power outages that have severely undermined the party's credibility.

As a result, the ANC now faces the necessity of forming coalitions to govern, marking a significant shift towards a more fragmented and potentially volatile political landscape. This new dynamic presents both challenges and opportunities for South Africa's future governance and policymaking. On one hand, coalition-building could lead to greater inclusivity and cooperation across political lines, potentially fostering innovative solutions to the nation's problems. On the other hand, it introduces risks of instability and policy gridlock, as diverse political agendas and interests must be reconciled.

The parties the ANC will include in the national unity government include the Democratic Alliance (DA), the Inkatha Freedom Party (IFP), Patriotic Alliance (PA), Freedom Front Plus (FF+), United Democratic Movement (UDM,) Rise Mzansi, Al Jamah, Pan Africanist Congress of Azania (PAC), and GOOD. These parties represent over 70% of the seats in the National Assembly (287 of 400), and will see significant opposition from the uMkhonto we Sizwe (MK), Economic Freedom Fighters (EFF), and other smaller opponents, as well as from disparate opinions within the unity government.


South Africa's New Political 'Big 5'  

African National Congress

The African National Congress (ANC) originated as a liberation movement known for its opposition to apartheid. This impact, and the legacy of early leaders like Nelson Mandela, is primarily seen as the bedrock of its political support in South Africa. However, the party has, since the latter 2000s, been embroiled in numerous, if not countless, allegations (proven and otherwise) of corruption and ill-governance, causing a steady shift in public sentiment. Up until the 2024 elections, the party governed eight of the country’s nine provinces.

  • Leader: Cyril Ramaphosa
  • Percentage of Votes: 40.18% 

Democratic Alliance

The Democratic Alliance (DA) is the second largest political party in South Africa. It is known for its liberal and centrist policies, advocating economic growth through free market principles, and a strong emphasis on constitutional democracy and individual rights. The DA has governed the Western Cape province since 2009, and has been credited for its good governance record and clean audits. Prior to the elections, it was criticized for its lack of racial diversity in leadership and anti-affirmative action policies.

  • Leader: John Steenhuisen
  • Percentage of Votes: 21.81% 

uMkhonto we Sizwe Party

The uMkhonto we Sizwe (MK) Party is a relatively new political entity in South Africa, emerging as a splinter group from the ANC and led by former President Jacob Zuma. The party advocates for radical economic transformation, including land expropriation without compensation and the nationalization of key industries, all of which were policy positions spearheaded by Zuma during his tenure. In addition, the party campaigned to scrap the Constitution and replace constitutional supremacy with parliamentary sovereignty.

  • Leader: Jacob Zuma
  • Percentage of Votes: 14.58% 

 Economic Freedom Fighters

The Economic Freedom Fighters (EFF) is a leftist and pan-Africanist political party, known for its radical and populist policies aimed at redistributing wealth and land to the black majority, nationalizing key industries, and enhancing state intervention in the economy. Founded by Julius Malema, a former leader of the ANC's Youth League, the EFF positions itself as a champion of the poor and disenfranchised, advocating for economic justice. Prior to the elections, it was severely criticized for its open border policy given South Africa’s undocumented immigration challenges. Its partial decline in these elections is also attributed to the arrival of the MK Party.

  • Leader: Julius Malema
  • Percentage of Votes: 9.52% 

Inkatha Freedom Party

Historically, the Inkatha Freedom Party (IFP) played a significant role during the transition to democracy, advocating for federalism and regional autonomy. The party's platform emphasizes traditional leadership, cultural preservation, and conservative economic policies. In recent years, the IFP has focused on issues such as governance, rural development, and social justice. Its perception as a Zulu nationalist party has limited its growth outside of Kwa-Zulu Natal..

  • Leader: Velenkosini Hlabisa 
  • Percentage of Votes: 3.85%


The Provincial Profile  

The change in national voting patterns is mirrored at the provincial level, most notably in Gauteng, KwaZulu-Natal (KZN), and the Western Cape. These specific provinces, are crucial due to their significant economic contributions, large populations, and strategic political importance.

Gauteng, as the economic heartland, hosts the largest urban economy and serves as the financial hub of the country. KZN, with its major ports and industrial base, plays a key role in trade and manufacturing. The Western Cape, known for its diverse economy and tourism sector, also stands out for its stable governance and business-friendly environment.

The electoral dynamics in these regions are indicative of broader national trends and will likely influence the future trajectory of South Africa's governance and economic policies.


KZN is a critical region for investment and business operations due to its strategic economic assets, including the major ports of Durban and Richards Bay, which are essential for international trade and logistics. The province's industrial base supports key sectors such as manufacturing and agriculture, contributing significantly to the national GDP. 

Despite MK Party’s electoral success in the province, the IFP managed to form a governing coalition by allying with its GNU partners, the ANC, DA, and the NFP. This coalition controls a slim majority of 41 seats (out of 80), marginally surpassing the combined seats of MK and the EFF. An IFP premier was elected, effectively sidelining the MK Party from provincial governance despite its leading vote share.


Gauteng is the economic powerhouse of South Africa, housing the largest urban economy in the country. It is the financial hub, home to the Johannesburg Stock Exchange (JSE) and the headquarters of numerous multinational corporations. Gauteng's robust infrastructure supports a wide range of industries, including finance, manufacturing, and technology.

Gauteng is experiencing delays in forming its government due to ongoing disputes between the ANC and the DA, both of whom are GNU partners, over legislative positions. The premiership and speaker roles have been allocated to the ANC, while the deputy speaker position has gone to the DA. The current impasse reflects the broader difficulties in achieving consensus in a fragmented political landscape, which could impact the province's ability to address critical economic and social issues efficiently.

Western Cape

The Western Cape is renowned for its diverse economy, encompassing sectors such as tourism, agriculture, and technology. Cape Town, the provincial capital, is a major business center with a reputation for stable governance and a business-friendly environment, making it an attractive destination for multinationals seeking to invest in dynamic and forward-looking markets.

The province remains under the control of the DA, which retained its majority in the 2024 elections. The DA secured 53% of the vote, enabling it to continue its leadership without the need for coalition partners. This electoral success has allowed the DA to swiftly appoint its provincial cabinet, ensuring a continuity of governance and policy implementation.

Ramaphosa's Reinauguration

Cyril Ramaphosa (71) was re-elected as South Africa’s president on June 15, 2024, for a second term. His election came only hours after his ANC agreed a power-sharing deal with opposition parties, giving him the backing to beat out the EFF’s Julius Malema by 283 votes to 44.

Ramaphosa gained prominence during the early 1990s as a key negotiator in the Convention for a Democratic South Africa (CODESA), where he played a crucial role in the negotiations that led to the end of apartheid and the establishment of South Africa’s world-renowned Constitution.

Following his success at CODESA, Ramaphosa transitioned into the business world in the mid-1990s. He founded Shanduka Group, an investment holding company with interests in various sectors, including mining, real estate, banking, and telecommunications – propelling him to significant wealth and influence in the corporate sphere. During this time, he also served on the boards of several major companies, including Lonmin, Standard Bank, and MTN. 

Ramaphosa returned to active politics in 2012 when he was elected Deputy President of the ANC and subsequently, Deputy President of South Africa under President Jacob Zuma. In this role, Ramaphosa was tasked with leading key initiatives, such as the National Development Plan. In February 2018, Ramaphosa succeeded Zuma as President of South Africa, following Zuma's resignation amid mounting corruption allegations. 

His first term as president was a mix of achievements and challenges. He pledged to tackle corruption, restore investor confidence, and revive the struggling economy. Despite efforts to attract foreign investment and stimulate economic activity, progress has been slow. Critically, while Ramaphosa has made strides in addressing corruption, his efforts have often been seen as too cautious. The ANC's internal divisions have hampered decisive action, and some critics argue that he has not done enough to dismantle entrenched patronage networks within the party. Nonetheless, his leadership brought stability and was marked by a commitment to democratic principles, structural reforms and institutional integrity.

"And so, as we enter another era in the life of our nation, the resilience of our democracy has once more been tested and the people have spoken loudly that they choose peace and democracy over violent, undemocratic and unconstitutional methods." Cyril Ramaphosa, Presidential Inauguration Address, 19 June 2024. 


GNU -- A New union or fragile alliance? 

Phase 1: GNU Statement of Intent

Following the watershed election results in South Africa, the ANC's National Executive Committee - its high decision-making body, resolved to establish a GNU model for government rather than a standard coalition government. While a statement of intent was originally signed between the ANC, DA, IFB, PA and GOOD, the ANC proceeded to engage all political parties that won parliamentary seats in the hopes of expanding the bloc in the National Assembly. 

On Saturday, June 22, 2024, the ANC announced a historic agreement between ten political parties to form the GNU. The ten parties include the ANC, DA, IFP, PA, FF+, UDM, Rise Mzansi, Al Jamah, PAC, and GOOD. As a bloc, these parties represent over 70% of the seats in the National Assembly (287 of 400).

Ramaphosa gained prominence during the early 1990s as a key negotiator in the Convention for a Democratic South Africa (CODESA), where he played a crucial role in the negotiations that led to the end of apartheid and the establishment of South Africa’s world-renowned Constitution.

In terms of the statement of intent, parties signing up to the GNU agreed to these fundamental principles: 

  1. Respect for the Constitution and the rule of law. 
  2. Non-racialism and non-sexism.
  3. Social justice, redress and equity, and the alleviation of poverty. 
  4. Human dignity and the progressive realization of socioeconomic rights.
  5. National-building, social cohesion, and unity in diversity.
  6. Peace, stability, and safe communities, especially for women and children.
  7. Accountability, transparency, and community participation in government.
  8. Evidence-based policy and decision-making.
  9. A professional, merit-based, non-partisan, developmental public service that puts people first.
  10. Integrity, good governance, and accountable leadership  

Parties to the GNU have also agreed to focus on a set list of priorities in the new administration. It is hoped that this will help to bring about common-sense solutions rather than allowing ideological differences to stifle progress. The agreed priorities include: 

  • Rapid, inclusive, and sustainable economic growth; the promotion of fixed capital investment; and industrialization.
  • Creating a more just society by tackling poverty, spatial inequalities, food security, and the high cost of living.
  • Stabilizing local government and ensuring effective cooperative governance. Investing in people through education and quality health care.
  • Building state capacity and creating a professional, merit-based, corruption-free, and developmental public service. Restructuring and improving state-owned entities to meet national development goals.
  • Strengthening law enforcement agencies to address crime, corruption, and gender-based violence, as well as strengthening national security capabilities. Strengthening the effectiveness of Parliament in respect of its legislative and oversight functions.
  • Strengthening social cohesion, nation-building, and democratic participation, and undertaking common programs against racism, sexism, tribalism, and other forms of intolerance.
  • Foreign policy based on human rights, constitutionalism, the national interest, solidarity, peaceful resolution of conflicts, to achieve the African Agenda 2063, South-South, North-South, and African cooperation, multilateralism and a just, peaceful and equitable world.

Phase 2: Appointment of National Executive (Cabinet) 

Since Ramaphosa’s presidential inauguration on 19 June, he has been locked in discussions with ANC allies and parties to the GNU to establish the national executive. Consitutionally, it is the prerogative of the President to appoint his cabinet, but in the interests of good faith, engagement, and stability within the GNU, this process is proving slow as parties tussle for positions. While the delays have caused some alarm and concerns that talks are on a ‘knife-edge’, this should be understood within the context of this being the first time the ANC has lost its majority at a national level. While this is common in more established democracies, it can take months to reach agreement on a collation government. 

Following setbacks in negotiations over the weekend between the ANC and DA, it is reported that negotiations are back on track following a one-on-one engagement between the leaders of the two parties on Monday, June 24.  At the time of writing, there is confidence that the President will announce his Cabinet this week. 

Following the announcement of the Cabinet, it is expected that parliamentary positions, such as committee chairpersons, will be determined. It is expected that smaller parties in the GNU will also be given representation.


The establishment of a GNU has demonstrated a strong support for the globally respected Constitution of South Africa and the democratic will of South Africans. Given the history of liberation movements failing to accept a loss of power through free and fair elections, this is a significant moment not only for democracy in South Africa, but on the continent.

Economically, the GNU could well be a catalyst to enable confidence, from an investment perspective, fiscal outlook, and an ongoing commitment to structural reform. Related hereto, the DA has publicly expressed support for the government’s Operation Vulindlela (plan to accelerate the implementation of structural reforms and support economic recovery) and on-going engagements with the private sector to address South Africa’s myriad of challenges.  

Focus now turns to cabinet appointments, seen as key to determining the GNUs ability to deliver on reform promises. Investors will be watching closely to see who fills key portfolios and whether the GNU can successfully navigate policy differences at a national level.

To succeed, pragmatism must replace hardline ideology across political parties in the GNU. The large number of smaller parties entering the GNU should be seen as an ANC strategy to mitigate the influence of the DA and limit internal pushback and further division within the ANC, where some view the DA as their ideological ‘enemy’. This is packaged as intending to seek consensus across the spectrum and bridging ideological divides and historical mistrust to form this unity government. The question remains, is it all too fragile to last?

In reality, although there are 10 political parties who make up the GNU, the DA-ANC-IFP make up over 60% of the GNU’s 70% bloc in parliament. This means that centrist constitutionalism will likely dominate the union, as where there is no consensus in decision making, ‘sufficient consensus’ will suffice.

In light of the damage done to South Africa’s economy and social fabric, following rampant corruption (state capture), years of electricity blackouts, declining service delivery, and decaying rail and port infrastructure – if anything, this union should lead to new dimensions of accountability in the interests of South Africa and her people.

Overall, the GNU is seen as positive for the economy and capital markets. Following the announcement of the GNU agreement, there was a strong rally in South African markets. Government bonds were sharply higher, and the rand and equity market rallied.  This demonstrates a boost in investor confidence in the outlook for the economy, indicating a renewed sense of optimism about South Africa’s future, critical to the country’s economic growth agenda. 

However, despite this newfound positive outlook, market activity has slowed somewhat as investors await the announcement and composition of President Ramaphosa’s cabinet. 


What's Next

While the immediate focus is on the announcement of the executive, attention will turn to an all-inclusive national dialogue process with parties, civil society, labor, and business. This platform will be used to discuss critical challenges facing the country in an open and transparent manner. It is envisaged that this process will lead to the development of a national social compact that enables South Africa to meet the aspirations of the National Development Plan (an important government policy document drafted in 2012, charting a vision to be achieved by 2030).

In addition, member parties of the GNU will be holding a lekgotla (strategy session) to develop an agreed policy agenda that will include policy priorities for the new administration. This will be a critical test of the GNU’s longevity and whether ideological divides will see a policy stalemate or a pragmatic approach to solving South Africa’s challenges. Market activity in the coming weeks will also be a key indicator of investor confidence in the stability of South Africa’s new government.


Why It Matters

South Africa plays a leading role on the African continent and in global institutions. Since the end of apartheid in 1994, South Africa’s democracy has provided business-friendly stability and fueled its economic growth. South Africa is regarded globally as a proponent of human rights and a leader on the African continent. On December 1, it assumes the presidency of the Group of 20 nations—20 leading rich and developing nations. South Africa is the only African nation in the G20. Additionally, South Africa is a pivotal member of the expanded BRICS group (Brazil, Russia, India, China, and South Africa), where it engages in efforts to promote economic cooperation, development, and political dialogue among emerging economies. Its participation in these international forums underscores its growing influence in shaping the agenda for developing nations in the Global South, advocating for more equitable global economic policies, and contributing to a multipolar world order.

The health of its democracy has regional implications. Issues of democratic backsliding have become a recent challenge in West Africa, and neighboring countries in Southern Africa will be watching closely the outcomes in South Africa, which could have a ripple effect throughout the region. South Africa's world-renowned Constitution, celebrated for its progressive and inclusive framework, sets a high standard for democratic governance and the protection of human rights in Africa. Moreover, the smooth transition to coalition governments or a Government of National Unity (GNU) is particularly noteworthy in a continent where liberation movements often struggle to relinquish power. This seamless shift serves as a powerful example for other African nations, demonstrating that democratic principles and collaborative governance can prevail even in politically complex environments. 

It functions as a regional hub for many multinationals. South Africa is set to reclaim its ranking as Africa's largest economy, according to the IMF's World Economic Outlook published in April. Several international corporations operate subsidiaries or house their African operations in South Africa, including NBA Africa, IBM, Microsoft, Google, Dell, Amazon Web Services, Meta, JP Morgan, Societe Generale. Approximately 600 multinationals operate in South Africa, with more than 180 Fortune Global 500 companies invested in the country - the largest concentration in Africa. South Africa is the largest US trade partner in Africa, with a total two-way goods trade of USD 14.6 billion in 2022, and has long been heralded as the ‘gateway to Africa’ – an appropriate base of operations from which economic connection to the rest of the continent can be formed and business developed.

Any instability or unexpected policy shifts could affect regional growth, as well as mining and manufacturing supply chains.Africa is poised to remain the second-fastest growing region after Asia. What happens in Africa’s third largest and most advanced economy could have global implications on mining and manufacturing supply chains. South Africa is the world’s largest producer of platinum, vanadium, chromium, and manganese.

In the coming days, EGA will be monitoring developments in the ANC’s coalition building and policy implications for businesses in the region. 

For further information, please contact Tony Taverna-Turisan ( or Amil Umraw ( 

This report was composed by Toyin Awesu, Anne MacDonald, Tony Taverna-Turisan, Amil Umraw, and our senior advisor George Mukundi. 

For more on global elections in 2024, The EGA Election HQ is your guide to the moments that matter, what comes next, and what all of this means for industries and sectors. Sign up here to receive global election updates from The EGA Election HQ team. For counsil or to get in touch, reach out to our elections team: