ANC will remain centrist
Whilst I posted previously that a concern with the formation of the new Shikota party is that it may push the ANC further left, the Business Day has an opposing view, which does make a lot of sense:
Economists say the founding of a viable new opposition party by ANC dissidents is likely to put pressure on the ruling party to deliver on its pledges.
However, it may also prompt the ANC to do more to keep the support of business leaders and an expanding black middle class, which its market-friendly economic policies helped create.
“The key concern — ahead of the formation of this political party — was whether it would lead to an exodus of centrists from the ruling ANC,” said Razia Khan, regional Africa research head at Standard Chartered.
“While that is certainly a possibility ... we do not yet see it as the main risk”. Leading “centrists” who remain in the ANC include Mathews Phosa, its treasurer, and prominent businessmen such as Cyril Ramaphosa and Tokyo Sexwale, Khan says. By the same token, Willie Madisha, the former president of the Congress of South African Trade Unions (Cosatu), has joined the new party.
Cosatu and the South African Communist Party (SACP) are the left-wing allies of the ANC, so Madisha is not an ideological “centrist” even though he lost his post over his support for former president Thabo Mbeki.
When Mbeki was axed in September, the initial perception in financial markets was that if a new political party was formed, it would drain supporters who had backed prudent economic policies.
Read the entire piece here.