{"id":67742,"date":"2024-06-04T07:05:26","date_gmt":"2024-06-04T07:05:26","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning"},"modified":"2024-06-04T08:47:10","modified_gmt":"2024-06-04T08:47:10","slug":"old-mutual-coalition-warning","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning","title":{"rendered":"Old Mutual coalition warning"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>South African financial markets will remain volatile for the next two weeks as political parties enter coalition talks, with there being a strong possibility of a sharp selloff in local assets and a sharp decline in the value of the rand.<\/p>\n

This is feedback from Old Mutual chief economist Johann Els, who said last week\u2019s elections had created a seismic shift in South African politics.<\/p>\n

For the first time in 30 years, the ANC lost its majority, securing only 40.18% of the vote, while former President Jacob Zuma\u2019s MK Party had a strong first showing.<\/p>\n

This dramatic change has significant implications for the country\u2019s economic and political future, Els said, as the nation faces a period of uncertainty and potential market volatility.<\/p>\n

\u201cThe election results were within the risk spectrum of our expectations, albeit on the higher end. The probability of a coalition or minority government remains significant, which likely suggests a continuation of current policies.\u201d<\/p>\n

\u201cHowever, the possibility of a more populist coalition cannot be discounted,\u201d Els warned.<\/p>\n

He explained that South Africa\u2019s financial markets are expected to remain unsettled over the two weeks until a coalition is formed. Depending on the makeup of the government, local assets could experience a sharp selloff.<\/p>\n

\u201cThe rand may experience volatility, potentially seeing a sharp sell-off as risk premiums rise.\u201d<\/p>\n

\u201cThis scenario mirrors the events of December 2015 when the former Finance Minister, Nhlanhla Nene, was replaced. A negative outcome, such as a leftist coalition, could lead to a substantial sell-off,\u201d warned Els.<\/p>\n

Despite the political upheaval in the build-up to the election and in its wake, South Africa\u2019s democratic processes remain robust, and there is no need to make hasty financial decisions.<\/p>\n

Els urged investors and savers to stick to established financial or investment plans and consult financial advisors before taking action.<\/p>\n

\u201cIt is crucial to remember that South Africa has significant inherent strengths that will mitigate political risks,\u201d Els highlighted.<\/p>\n

\u201cThese strengths include a strong constitution with entrenched rights, an independent judiciary, including a fiercely independent Constitutional Court, and a free media.\u201d<\/p>\n

\u201cIt also includes independent institutions such as the South African Reserve Bank (SARB), the Treasury and the South African Revenue Service (SARS), a well-regulated financial sector and deep capital markets.\u201d<\/p>\n

\u201cThe end of the state capture era, with society determined to prevent its recurrence, has also cultivated a healthy private sector that plays a vital role in the economy, especially in areas where the state and state-owned enterprises have faltered.\u201d<\/p>\n

Scenarios range from an ANC, DA, and IFP coalition, which markets favour due to the promise of more policy reform, stronger implementation, and a firm stance against corruption, to a Government of National Unity (GNU) involving the ANC, DA, MK, EFF, and IFP.<\/p>\n

While this option offers broad buy-in, it could be seen as detrimental to policy and growth due to potential conflicts.<\/p>\n

An ANC minority government supported by the DA and IFP might maintain current policies but could be viewed as less stable.<\/p>\n

An ANC, MK, and EFF coalition would be the least favourable outcome unless there is a strong consensus to continue current ANC policies, which is unlikely.<\/p>\n

For More News And Analysis About South-Africa<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – South-Africa. South African financial markets will remain volatile for the next two weeks as political parties enter coalition talks, with there being a strong possibility of a sharp selloff in local assets and a sharp decline in the value of the rand. This is feedback from Old Mutual chief economist Johann Els, who […]<\/p>\n","protected":false},"author":84,"featured_media":67740,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[274,315,275],"class_list":["post-67742","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-africa-press","tag-africa-press-south-africa","tag-south-africa-2"],"yoast_head":"\nOld Mutual coalition warning - South Africa<\/title>\n<meta name=\"description\" content=\"South African financial markets will remain volatile for the next two weeks as political parties enter coalition talks, ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Old Mutual coalition warning\" \/>\n<meta property=\"og:description\" content=\"South African financial markets will remain volatile for the next two weeks as political parties enter coalition talks, ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning\" \/>\n<meta property=\"og:site_name\" content=\"South Africa\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2024-06-04T07:05:26+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-06-04T08:47:10+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/06\/sm_1717477981.994536.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"768\" \/>\n\t<meta property=\"og:image:height\" content=\"432\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Old Mutual coalition warning\",\"datePublished\":\"2024-06-04T07:05:26+00:00\",\"dateModified\":\"2024-06-04T08:47:10+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning\"},\"wordCount\":540,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/06\/sm_1717477981.994536.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-South-Africa\",\"South-Africa\"],\"articleSection\":[\"all news\",\"economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/old-mutual-coalition-warning\",\"name\":\"Old Mutual coalition warning - 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