Economic growth in 2026 is key to survival of the coalition government

While multiple lenses exist to interpret South Africa’s current political climate, the most significant structural divide is whether a party is in the national coalition or outside it.

Obviously, there are big differences between the parties that are members of the coalition, but broadly speaking, they support the Constitution, the rule of law and democracy.

Even though some, like the Patriotic Alliance or Al Jama-ah, are populist, and others, like the Pan Africanist Congress, want to change important parts of the Constitution, in essence, these are parties that support the current system, while most of the parties outside the coalition want radical change.

The prime examples are the uMkhonto Wesizwe (MK) party, which doesn’t believe there should be a Constitution, while the EFF wants radical changes that would fundamentally change SA’s political system.

There are exceptions, like ActionSA, which is outside the coalition and broadly supportive of the Constitution.

Prosperity is the glue

Perhaps the most important factor determining whether parties remain in the coalition or leave it is economic growth. Prosperity is the glue that holds coalitions together. If the economy thrives, ideological differences and personality clashes fade into the background, as no party wants to be blamed for abandoning a winning formula.

So, if the economy grows, the parties in the coalition are likely to enter the 2029 elections with the expectation of staying in the coalition, giving them another five years in power and, if they are successful, more space for the economy to grow.

Improving the material conditions of the majority would strengthen the forces of constitutionalism and weaken radical voices.

Conversely, an economic failure would trigger an exodus from the coalition as parties distance themselves from a sinking ship. Such a collapse would leave voters vulnerable to anti-constitutionalist rhetoric, potentially ending the coalition well before or by 2029.

If radical parties then enter the government, or win significantly more support, the chances of SA’s economy growing would weaken substantially.

A victory for radical parties would stifle economic growth, potentially permanently barring a pro-constitutional coalition from regaining power. While our current political landscape may seem stable, the clock is ticking — and the deadline is fast approaching. The upcoming local elections could fundamentally reorder party dynamics and shift the balance of power, making the end of this year a critical turning point for South African politics.

Significant gains for the DA at the ANC’s expense — or vice-versa — will trigger claims that one partner is benefiting at the other’s cost. In a stagnant economy, these electoral imbalances are likely to become fatal fault lines, which could lead to tensions that the coalition cannot survive.

ANC leadership contest

The local elections and their outcome will also be the starting gun for the ANC’s leadership contest.

One reason the candidates and their campaigns are relatively quiet at the moment is that the regions and provinces of the ANC are not certain of their power relative to each other.

If, for example, the Gauteng ANC loses power in all three metros in that province, it would be difficult for it to act as a power broker in the ANC’s internal leadership election the following year.

And once the leadership contest starts, involvement in the national coalition may become a major feature of it.

Again, without the glue of economic growth, the ANC’s leadership battle could have huge implications for whether the national coalition continues.

Measuring whether economic growth has reached the average voter is a complex task. It is highly improbable that significant material changes will occur in such a short window; however, even a marginal improvement might be sufficient to restore a sense of hope and convince the electorate that the country is finally on the right track.

If a young person in your community gets a job for the first time, you may believe that your daughter will get the next job. And if you see that more people are working, then you will know that your chances of getting a job are improving.

The fact is that the momentum is rolling in the right way.

The single biggest success of this government (as contested as it will be) is the end of load shedding. Just that factor alone will have improved the lives of millions of people and improved their economic prospects.

While load reduction is still a major issue in many townships, Eskom is making progress in dealing with that problem, too.

Meanwhile, partly through the actions of the government and partly because of other factors (including the huge increase in production in China), inflation is at historic lows.

Last year, SA had its lowest annual inflation in more than 20 years. And while some foodstuffs (including beef) are still experiencing high inflation, many people will be aware that things have improved.

A rand that is stronger against the dollar and an oversupply in the oil market mean that fuel prices should be relatively low for some time (they’re predicted to fall below R20 a litre in the next few months).

Heavy rains in many parts of the country will boost harvests, giving farmers more produce to sell (in some cases, this might bring down food price inflation, but the prices of maize and other commodities are internationalised, so we may not see that much relief).

And the gold price at record levels and rising platinum prices will bring a lot more money into our mining companies and our mining communities.

While much of this is not the work of the coalition, it will still claim the credit.

As in most democracies, voters reward a government when the economy is doing well and punish it when the economy fares badly.

There are many reasons to be optimistic about 2026.

Hopefully, that optimism is well-founded, and South Africa decisively transforms its economic trajectory. DM