South Africa heads into uncertainty with Zuma victory

POLOKWANE, South Africa - South Africa faced deep uncertainty on Wednesday after the greatest political shake-up since the end of apartheid set populist Jacob Zuma on the road to the state presidency.

Newspapers described Zuma's stunning victory in an election for leader of the ruling ANC as a tsunami, and said the defeated party boss, President Thabo Mbeki, had been humiliated. The tabloid newspaper Sowetan carried the headline "Zunami Rules".

Zuma not only defeated Mbeki but swept aside the entire old guard of the party, filling all top positions with his allies.

Despite fears by some investors that Zuma, who is backed by trade unions and the Communist Party, will push the country to the left, markets remained unmoved and there was little change in the rand. Investors said they had priced in a Zuma win.

But there was concern that Zuma's victory, splitting South Africa's two most powerful jobs for the first time since apartheid ended in 1994, could paralyse decision making.

Mbeki now has no position in the party that dominates the country, and could become a lame duck for his remaining 18 months in power. Zuma is now the prime candidate to succeed him at the next election in 2009.

South Africa faces a host of urgent problems, including an AIDS crisis, one of the world's worst crime rates, and the poverty that still afflicts millions of blacks more than a decade after apartheid ended.

Mbeki's downfall was caused to a large extent by anger in the ANC rank and file at what they saw as neglect of these problems, particularly poverty, while he pursued business-friendly economic policies.

CORRUPTION CHARGES

Adding to the mood of uncertainty is the threat of corruption charges hanging over Zuma in relation to an arms buying scandal, which make it conceivable that he could be jailed before he succeeds to the presidency.

"We can anticipate this conflict extending over the next two years. It is going to be particularly precarious when Jacob Zuma gets charged, if he does get charged, over the corruption scandal," said political analyst Adam Habib.

Prosecutors said this month they had new evidence that could lead to renewed charges against Zuma, after a previous case collapsed.

The 65-year-old Zuma, an ethnic Zulu, has made a remarkable comeback after setbacks that would have buried most politicians.

Apart from the corruption scandal, he was acquitted of rape in 2006. Evidence in that case, including his admission that he showered after sex with an HIV-positive family friend to avoid infection, tarnished his reputation.

Senior ANC officials said Zuma's election was unlikely to lead to a shift in economic policy, which is set by the party.

"At the moment, there are no ideological differences ... The policy is in place and intact," said ANC deputy leader Kgalema Motlanthe.

Trade union federation COSATU has called on the government to loosen monetary policy and increase spending to bring the benefits of an economic boom to millions of poor and unemployed.

But Motlanthe said the new ANC leadership would not be in debt to the unions. "There is no room for payback ... basic policy will not change," he said.