Capping any optimism is the belief that South Africa’s economic fundamentals are not as positive as they could be. Its economy grew at just 0.7 percent in 2017, according to the International Monetary Fund, well below emerging markets as a whole which grew at 4.6 percent.
The uncertainty of Zuma’s political future crystalized earlier this week when South Africa’s annual State of the Nation speech, to be given by the president, was canceled just days before it was expected to take place Thursday. No date was given for its rescheduling, and rumors have been swirling that senior ANC leaders are now focused on ousting Zuma.
South Africa’s Johannesburg Top 40 index has plunged in recent days on political uncertainty and closed over 1.5 percent lower Friday afternoon.
Atwell picked “areas prioritized for government spending, for example, the health sector” as those to invest in, as well as technology stocks.
“Ramaphosa is likely to take a ‘do no harm’ approach to the economy. But politics will get in the way of more fundamental reforms, at least until after the elections in 2019,” Payton said.