South Africa’s SONA 2020: President Ramaphosa strikes a careful balance

SOUTH AFRICA - Report 14 Feb 2020 by Iraj Abedian

President Ramaphosa delivered his 2020 State of the Nation Address (SONA) against a fairly dramatic background. Within the Parliament, the opposition party, EFF, staged a rowdy and disruptive scene to demand the sacking of Minister Gordhan - the Minister of State-owned Enterprises. (SOEs). The EFF also objected to the presence of former President de Klerk in the Parliament, arguing that de Klerk cannot be in there given his views on apartheid, never mind his role in the apartheid regime.

Outside the parliament, a drama of a different nature has been at play. South Africa’s economic environment is in such a dire state that a significant negative shock, such as a credit rating downgrade to junk status, could send the country into a deep recession that would take years to exit. The country has had high expectations for President Ramaphosa to lift the economy out of the current state of limbo while at the same time improving governance, including governance of state-owned entities (SOEs). Nonetheless, skepticism has been rising due to the seeming lack of tangible results from the President’s administration. Confidence in the country is muted, and even though it improved somewhat following the election of Mr. Ramaphosa as the President of the ANC and then of the country during end-2017 to beginning-2018, it has since plummeted again amid lackluster growth as well deteriorated macroeconomic fundamentals.

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