The results of the South African national elections are out, and they reflect a new era where no single party holds a majority in Parliament, potentially leading to a coalition government.
Below are the full results for the 2024 elections.
What is a coalition government?
A coalition government forms when two or more political parties (or independent representatives) combine their votes in a legislature or council to elect and support a government. This becomes necessary when no single party has a majority. In South Africa, elections result in multiple parties in Parliament, provincial legislatures, or municipal councils, where executive leaders (President, premiers, and mayors) are elected and can be removed by these bodies. Without a party holding over 50% of the seats, coalitions are essential to maintain support for the executive and prevent them from being voted out.
In his speech during the announcement of the results, the President of RSA said:
“What this election has made plain is that the people of South Africa expect their leaders to work together to meet their needs. They expect the parties for which they have voted to find common ground, to overcome their differences, to act and work together for the good of everyone.
“Our people expect all parties to work together within the framework of our constitution and address whatever challenges we encounter peacefully and in accordance with the prescripts of our constitution and the rule of law. Each party emerges from this election with a mandate based on the commitments they each made to the electorate.”
In one of our EasyDoesIt episodes earlier this year, we had Daresh Lawengee, CEO of Rise EasyRetire, who explained to investors what a coalition government could mean for investors and changes that could arise in the South African political landscape.
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Conclusion
A coalition government can impact investors by creating uncertainty and unpredictability in policy-making, as multiple parties with differing agendas may struggle to achieve consensus. This can lead to delays, policy shifts, and potential instability, affecting investor confidence.
Investors should monitor the dynamics within the coalition, focusing on their ability to collaborate and maintain stable economic policies. They should also watch for the coalition's commitment to upholding the rule of law and maintaining a business-friendly environment, as these factors are crucial for investment security and growth.
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