South African President Jacob Zuma resigns amid pressure from his African National Congress party
On Thursday, February 15, the South African Parliament overwhelmingly voted in Cyril Ramaphosa as the country’s new president following the resignation of now-former President Jacob Zuma. This leadership change has not been without significant drama: In December, Ramaphosa, a former trade unionist and businessman, was narrowly elected the head of the ruling party, the African National Congress (ANC), in a close election against Zuma’s ex-wife Nkosana Dlamini-Zuma. Though President Zuma’s step down as head of the ANC in December was planned, he expected to serve out his term as president through 2019.
Research Analyst and Project Coordinator - Africa Growth Initiative
The pressure for a change in leadership had been increasing sharply since December, culminating Wednesday evening, when the ANC demanded Zuma step down or face a no-confidence vote on Thursday. Then, Zuma, after hours of waiting and uncertainty, officially resigned. Zuma had barely survived eight no-confidence votes held against him since the beginning of his tenure as president in 2009. In his resignation speech, he emphasized that he had done nothing wrong and was being treated unfairly by the ANC.
The tide had been turning against Zuma in recent years, largely due to constant criminal and corruption scandals that have embattled the now-former president. For example, in 2016, the South African Supreme Court found him guilty of violating the constitution by not paying back government funds illegitimately used to upgrade his personal home. Recently, Zuma’s ties with the influential Gupta family have also been under investigation. Investigators allege that Zuma has enabled the Gupta family to appoint or buy government leaders and obtain government contracts. Wednesday saw raids of a Gupta house due to accusations of corruption and, as of Friday, one of the brothers is currently a “fugitive from justice.”
Zuma’s management decisions as well as handling of the struggling economy have also been under question: After an ill-advised and controversial cabinet reshuffle in December 2015—ending up with him firing two finance ministers in one week—thousands of protesters took to the streets, demanding his resignation. Though he restored former Finance Minister Pravin Gordhan, a decision that allayed market fears, he fired Gordhan early last year, citing an unfounded rumor that the minister was plotting to undermine the government. Then, in June 2017, a Bloomberg poll reported that 54 percent of ANC voters wanted him to resign and just 27 percent wanted him to stay.
Experts note that new President Ramaphosa has a tough road ahead of him, as he will need to continue to fight the country’s massive inequality and turn the ailing South African economy around. Unsurprisingly, Ramaphosa also mentioned fighting corruption in his acceptance speech on Thursday.
Ethiopian Prime Minister Hailemariam Desalegn resigns
In an unexpected move, Ethiopia’s Prime Minister Hailemariam Desalegn resigned as premier and chair of the ruling coalition on Thursday. “Unrest and a political crisis have led to the loss of lives and displacement of many,” he stated in a televised address, noting further, “I see my resignation as vital in the bid to carry out reforms that would lead to sustainable peace and democracy.” According to Deutsche Welle, protracted anti-government protests and civil unrest, prompted in 2015 by controversial urban development plans for Addis Ababa, and then by government crackdowns on political opposition and dissent, has left hundreds of people dead and tens of thousands of people in prison. Recently the government has begun releasing political prisoners in an attempt to quell tensions.
Although a new premier has not been named, the ruling Ethiopian People’s Revolutionary Democratic Front (EPRDF) coalition is scheduled to hold a congress next month according to Reuters, which could serve as a forum for announcing Desalegn’s replacement.
Former Liberian President Ellen Johnson Sirleaf receives the 2017 Ibrahim Prize for Achievement in African Leadership
This week, the Mo Ibrahim Foundation announced that former Liberian President Ellen Johnson Sirleaf is the 2017 recipient of the Ibrahim Prize for Achievement in African Leadership. The prize is awarded to former African heads of state or government that were democratically elected, served their term as prescribed by the constitution, and demonstrated exceptional leadership. Eligible winners must have left office in the past three years. The prize gives recipients $5 million over a 10-year period and $200,000 per year after that.
Since its inception in 2006, President Sirleaf is only the fifth recipient of the prize as few leaders have met the criteria. Past winners include Hifikepunye Pohamba of Namibia (2014), President Pedro Pires of Cabo Verde (2011), President Festus Mogae of Botswana (2008), and President Joaquim Chissano of Mozambique (2007). Nelson Mandela became an honorary recipient of the prize at its inception.
The prize committee praised Sirleaf’s efforts in governing Liberia in the years following its civil war. Prize Committee Chair Salim Ahmed Salim states that Sirleaf worked tirelessly on behalf of the Liberian people in order to “lead a process of reconciliation that focused on building a nation and its democratic institutions.” Sirleaf left office last month after handing the country over to former footballer George Weah.
In a statement, the former president thanked the foundation and added that her “most proud accomplishment is that after 30 years of conflict, the power in Liberia now rests where it should—with the people, grounded in rule of law, and in strong institutions.”
Moody’s downgrades Kenya’s credit ratings over mounting debt
Moody’s Investors Service announced on February 13, 2018 that it has lowered Kenya’s sovereign credit rating from B1 to B2 with a stable outlook, citing rising debt levels, deteriorating debt affordability, and weakening fundamentals as the main drivers of the downgrade. Moody’s expects government debt to reach 61 percent of GDP in the fiscal year 2018/2019, up from 56 percent of GDP in FY 2016/2017 and 41 percent of GDP in FY 2011/2012. “The government will continue to face liquidity pressures due to a combination of large financing needs and an increased reliance on sources of financing with less predictable costs,” Moody’s noted in a press release. Still, it maintains that Kenya’s outlook is stable based on the country’s diversified economy, high growth potential, deep capital markets, and mature financial sector.
Kenya’s director-general of budget, fiscal and economic affairs at the Treasury, Geoffrey Mwau, disputed the downgrade decision, arguing that Moody’s analysis appears to reflect the numbers from the last fiscal year, during which the country experienced a number of unusual shocks to the economy due to drought and the huge costs of funding two elections. “These are just shocks that affected us and they are going to go down,” he remarked. He suggested further that Kenya has strong fundamentals, as illustrated by its stable exchange rate and low inflation.
The ratings downgrade for Kenya comes at a particularly inopportune time, as the country is poised to issue another eurobond of up to $3 billion and is currently marketing the bond in the U.S. and U.K. Observers have expressed concerns that the rating downgrade will make borrowing more expensive for Kenya since a country’s credit rating is linked to its cost of borrowing, with better credit ratings translating to lower interest rates on debt.