ANC in distress

25 August 2025 — Is the ANC falling apart? Will the DA be the biggest party in the three Gauteng metros next year? How will increasing political violence impact business in SA? Are Transnet’s days numbered? How did Sakeliga strike a blow against “third wave BEE”?

ANC in distress

The bad news keeps mounting for the African National Congress (ANC).

A recent report by the ANC-aligned Mapungubwe Institute for Strategic Reflection (MISTRA) analyses long-term political trends and notes that since 1994, the ANC has lost its majority in Gauteng, KwaZulu-Natal, the Northern Cape, and the Western Cape, although it continues to govern all these provinces except the Western Cape as part of a coalition.

MISTRA considers it likely that the party will also lose its majority in the Free State and in Mpumalanga in the 2029 national election, while the North West province is on the edge. That would leave the ANC retaining its majority only in Limpopo and the Eastern Cape.

This was followed by a comment from Senzo Mchunu, a member of the ANC’s National Executive Committee and former police minister. Speaking at a tombstone unveiling in northern KwaZulu-Natal, Mr Mchunu warned that the ANC was facing imminent collapse and described the upcoming local government elections as a make-or-break moment for the party. The ANC head office rebuked him for his comments, saying they did not reflect the views “of any legitimate structure of the movement”.

Also last week, it was revealed that the MTN Group was under criminal investigation by a United States (US) Department of Justice grand jury into its conduct, that of its former subsidiary in Afghanistan, and Irancell, in which it owns a 49% stake. A grand jury is designed to determine whether criminal charges should be filed and has access to extensive investigative tools and powers.

The investigation could reveal financial links between senior ANC members, the South African government and the Iranian government, which — if confirmed — could lead to harsh US sanctions against implicated South African individuals and institutions.

High-ranking ANC member Mcebisi Jonas, President Cyril Ramaphosa’s designated special envoy to the US, is the current chairman of MTN, while Mr Ramaphosa is a former chairman of MTN. Such revelations would also further sour South Africa’s relationship with the US.

DA on the ascendant in the metros

A new Democratic Alliance (DA) poll released last week finds the ANC polling at 23% to the DA’s 40% in Johannesburg. The poll, conducted on 14 August, forms part of a tracking poll which will survey registered voters in the metros every two weeks ahead of the next local government elections.

In Tshwane, the DA polled at 48% to the ANC’s 27%, and in Gauteng’s third metro, Ekurhuleni, the DA was measured at 41% and the ANC at 19%.

At national level, the DA poll had ANC support at 29%, the DA at 28%, the uMkhonto weSizwe Party at 11%, the Economic Freedom Fighters at 8%, and the Inkatha Freedom Party at 3%.

Voter turnout is generally lower in local elections than in national and provincial elections, and lower turnout has traditionally hurt the ANC more than it has other parties. Helen Zille’s mayoral bid will further boost the DA’s appeal. However, in the past the ANC has often surpassed its polled numbers in actual election performance.

ANC sources that spoke to Business Day painted an even gloomier picture, saying: “Our information shows the ANC could get as little as 12% [of the vote] in Johannesburg. The leadership of the province and city are accountable, as they refused the national leadership advice to enter a coalition with the DA”.

Further ANC decline is now widely seen as inevitable. It is rooted in the party’s continued reluctance to hold corrupt leaders and members accountable, its unwillingness to listen to voters and inability to address their concerns, and its doubling down on anti-growth policies.

What matters is how it and other parties, businesses, and civil society deal with that decline in the lead up to the local government elections, the ANC’s 2027 leadership conference, and the 2029 national election.

Rising risk of political violence

As the ANC’s hold on power weakens and South African politics becomes more competitive, political violence becomes increasingly likely. The patronage networks that have been created around and within the ANC over many years will not go quietly if they start to feel truly threatened.

The extortion and profiteering gangs linked to construction, water, transport and other sectors that have proliferated in recent years are likely to fight back if they fear losing access to state resources as the ANC’s power wanes.

Though a political background to the attempted hijacking of DA MP Ian Cameron and two colleagues in Philippi, Cape Town, last week has not been confirmed yet, the incident confirmed that no one is truly safe from the country’s consistently high crime rate.

The 2023 Global Organised Crime Index — the latest available — places South Africa 7^th globally for organised crime, up from 19^th in 2021. This positions it behind only Myanmar, Colombia, Mexico, Paraguay, the Democratic Republic of the Congo, and Nigeria. The Index highlights multiple criminal markets, with the highest risks in synthetic drugs (8.5), extortion and protection racketeering (8.0), arms trafficking (8.0), non-renewable resource crimes (8.0), and financial crimes (7.5).

The findings of the Index match the warnings from KwaZulu-Natal Provincial Police Commissioner Nhlanhla Mkhwanazi, who has alleged that powerful business and political figures protect organised crime syndicates from prosecution. Such protection undermines enforcement.

The Index records a drop in resilience to organised crime, with law enforcement rated at 4.5/10, the weakest score in southern Africa. Businesses are left exposed to an uneven playing field where competitors may be backed by illicit capital or enjoy protection from corrupt officials.

The government’s declining capacity to contain organised crime means criminal actors are filling governance vacuums, especially in local municipalities. This has implications for service delivery, procurement, and community stability. Investors face higher operational risks, reputational exposure, and greater likelihood of targeted violence and social unrest.

Transnet nudges open the door

Transnet’s decades-long rail monopoly has nominally come to an end. Last week transport minister Barbara Creecy announced that 11 private sector operators — chosen from 25 applicants — had been conditionally awarded slots to run trains on Transnet’s rail network. Successful applicants will run trains on 41 routes across 6 rail corridors. The allocations will run for between 1 to 10 years.

The success of this initiative will hinge on the specific terms of the deals and on the government’s sustained support for the initiative.

The development comes at an opportune moment for Transnet. Competitors in neighbouring countries Namibia and Mozambique have over the last two years taken steadily more regional port and rail freight, investing in their trade infrastructure along the way. In releasing its latest interim results last week, JSE-listed Grindrod reported both its Maputo (1.5 million tonnes) and Matola port terminals had recorded record volumes in July.

If greater private-sector involvement takes hold and rail freight becomes more functional and cost-effective, this offers some hope for South Africa’s exporters and importers, who have been battling with severe logistics challenges for several years.

Sakeliga strikes a blow against “third wave BEE”

On 5 August 2025, Sakeliga secured a significant legal victory in the Pretoria High Court, which ruled that the Air Service Licensing Council’s (ASLC) use of BEE or race-based criteria in its decision-making was unlawful. The court confirmed that BEE cannot be used as a precondition for private commercial activity within the sector.

This outcome, part of Sakeliga’s battle against the “third wave” of BEE enforcement where racial criteria are imposed as a prerequisite for business participation in the economy, could have implications for other race-based interventions across the economy.

The ASLC had been unlawfully denying air service licences based on Broad-based Black Economic Empowerment Act (B-BBEE) certification and transformation criteria since December 2023. This was in direct conflict with the statutory mandate outlined in the Air Services Licensing Act 115 of 1990, which specifies that licences must be granted when applicants meet safety, residency, and aircraft control and registration requirements. The Act expressly prohibits the ASLC from imposing additional conditions, such as BEE compliance.

This case highlights the regulatory risk businesses face from inconsistent and unlawful application of transformation policies. It also signals a more assertive role for the courts in enforcing the limits of the state’s transformation agenda.

If this precedent holds, businesses in other sectors may be emboldened to challenge BEE-based licensing conditions. This introduces new legal risks for regulators while opening strategic opportunities for businesses operating in contested or tightly regulated markets.