14 May 2019

South Africa Wins a Fragile Post-Election Window of Economic Opportunity

analysis

SA has come out of the 8 May 2019 elections on a solid footing and has even managed to withstand the financial market sell-off on the flare-up in trade tensions between the US and China late last week. Now all eyes are on whether President Cyril Ramaphosa has the mandate to push ahead with necessary policy reform, taking advantage of this invaluable window of opportunity against a still-nervy global economic backdrop.

The rand, South Africa's investor sentiment temperature gauge, held up well in the face of renewed US-China trade tensions and unfolding local election results.

This bodes well for the country and suggests that, global trade tensions notwithstanding, President Cyril Ramaphosa has a window of opportunity to make the policy and economic headway he seems set on -- and which will get South Africa out of its economic mire.

The initial signs are that the elections have provided South Africa with some grounding and that Ramophosa is gearing up to get going on the most pressing government initiatives. The results, which Sanlam Investment economist Arthur Kamp describes as holding the centre, were generally viewed as providing political continuity and, on the margin, as a positive for the country.

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