Zuma Signals South African Black Ownership Push After Vote

Photographer: Dean Hutton/Bloomberg

“In no way can we have conflict that destroys the economy,” Zuma said yesterday in his state-of-the-nation speech to Parliament in Cape Town. Close

“In no way can we have conflict that destroys the economy,” Zuma said yesterday in his... Read More

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Photographer: Dean Hutton/Bloomberg

“In no way can we have conflict that destroys the economy,” Zuma said yesterday in his state-of-the-nation speech to Parliament in Cape Town.

South African President Jacob Zuma said the government must push for increased black ownership of the continent’s biggest economy, signaling his policy focus as he prepares for a second term in office.

“We want to accelerate black empowerment because if we don’t, those who want to come into the economy become impatient and correctly so,” Zuma, 71, said yesterday in an interview at his official residence in the capital, Pretoria. “We are making progress but it’s not enough. The real ownership of the economy is still a problem.”

After two decades in power, Zuma’s African National Congress is facing the stiffest challenge to its rule in May elections. Many black South Africans are growing impatient at the slow distribution of wealth in an economy where whites still earn on average six times more than blacks.

Zuma admitted his government’s empowerment policies, which focus on transferring company stakes to black investors, haven’t done enough to redistribute wealth. The government has sought to refine the laws to ensure a wider section of the population benefits amid criticism from labor unions and opposition parties that the policy only benefits a small elite.

“It does not change much if people just own shares in companies, they have no control over companies,” Zuma said. “Let us have black industrialists. When we talk about radical change and the economic approach, we are looking very closely at what we can do to quicken that process.”

Workers’ Party

Rising public protests and a move by the nation’s biggest labor union to withdraw its support for the ANC in favor of forming a workers’ party indicate dissatisfaction with the pace of economic redress, said Aubrey Matshiqi, a political analyst at Helen Suzman Foundation, a Johannesburg-based research group.

“If what Zuma is promising is not going to change direction in the ANC’s economic policy, then it is likely that the formation of a labor party will attract voters who feel that the ANC is failing to deliver economic inclusion for the working class and the poor,” he said in a phone interview.

Support for Africa’s oldest political party has dropped by 10 percentage points to 53 percent in the past year, according to a survey of 3,564 adults interviewed by polling company Ipsos in October and November.

Zuma dismissed the forecasts, saying the ANC’s share of vote would likely grow. The ANC’s record of providing 3.3 million free houses to the poor and welfare grants to about 16 million people mean voters will remain loyal to the party that led the struggle against white minority rule, he said.

Nkandla Scandal

That record isn’t evident amid rising discontent among poor, black township residents that have staged at least 94 protests this year to demand electricity, water, houses and jobs in a country with a 24 percent unemployment rate.

Zuma himself has come in for criticism after the government revealed that more than 200 million rand ($19 million) of public funds was spent on renovating his personal residence in Nkandla, in KwaZulu-Natal province. He was booed on March 5 for a second time in three months at a publicly televised event, indicating his declining popularity.

“People make it a huge mountain and it’s nothing but a language of politics. Booing is not a big deal” Zuma said. “I don’t take anything personal from it. I am a politician.”

South Africa’s corruption ombudsman, Thuli Madonsela, is due to publish her report on an investigation into Nkandla on March 19. A government report on Dec. 19 found that Zuma had no role in authorizing the funds.

Opposition Challenge

The rand has slumped 14 percent against the dollar in the past year as strikes at mines and carplants curbed economic growth and investors sold riskier, emerging-market assets. The currency was trading at 10.608 per dollar as of 12:16 p.m. in Johannesburg.

Opposition political parties are seeking to tap public anger against Zuma and the ANC in the May 7 election. The Ipsos survey suggests the main opposition Democratic Alliance may win 18 percent of the vote, while the Economic Freedom Fighters, led by expelled ANC youth leader Julius Malema, may get 4 percent.

Zuma said he didn’t “pay much attention to opposition parties” because they offered no alternative to voters, with the DA recreating racial segregation in Western Cape, the only province out of nine that the ANC doesn’t control.

“The Western Cape is the province that most defines apartheid,” Zuma said. “You go to the black areas, there is nothing that is happening and that’s a big problem. People are in trouble and there isn’t much that goes to the black areas. There’s a lot that goes to white areas.”

Zuma, who first won control of the ANC in 2007 when he defeated former President Thabo Mbeki, became leader of the country two years later, just weeks after prosecutors dropped charges against him for allegedly taking bribes from arms dealers. A polygamist with four wives and 21 children, Zuma was acquitted of rape charges in 2006. In 2010, he confirmed he fathered a child with the daughter of a friend.

To contact the reporters on this story: Franz Wild in Johannesburg at fwild@bloomberg.net; Amogelang Mbatha in Johannesburg at ambatha@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net; Nasreen Seria at nseria@bloomberg.net

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