Article

South Africa in 2026

JOHANNESBURG, SOUTH AFRICA

IT is going to be a fascinating year for South Africa. We can expect significant developments on economy and politics as the country navigates a fast-moving world dominated by the likes of the United States and China.

Last year, South Africa was thrust into the global spotlight as relations with Washington deteriorated.

In 2024, I predicted a showdown between the US and South Africa should Donald Trump return to the White House—and that is exactly what happened last year. The meeting between President Trump and President Cyril Ramaphosa at the White House last May was unforgettable; Trump famously played videos of Julius Malema and the Economic Freedom Fighters (EFF) chanting “Kill the Boer.”

For those of us who track economic and political trends for a living, a crucial question remains: can the US and South Africa find common ground this year? The current tension serves no one in South Africa. Our country needs the US market; quite frankly, we need Americans more than they need us. Anyone suggesting otherwise is either dishonest or ignorant.

Frankly speaking, I doubt the US-South Africa situation will improve in 2026. As I wrote last August, relations are effectively frozen, and there is little chance of improvement under the Trump administration. I hope I’m wrong.

The Local Government Elections Will Be Important

No major national events are expected to disrupt the ongoing reforms under the Government of National Unity (GNU). However, the upcoming local government elections will be important.

I expect voter turnout to decrease further in these local government elections, with the ANC continuing its decline in metropolitan areas. Turnout in the 2021 local elections was just 46%—the lowest in our democratic history. While turnout for local polls has historically lagged behind national elections, this trend of apathy is concerning.

Helen Zille is running for Johannesburg mayor and her win would be significant. It would certainly disappoint race hustlers and ideologues who push the agenda that race identity is the sole driver of South African politics. It would be a “painful” shock to them to see the majority of Johannesburg’s citizens—most of whom are Black—vote for a white politician to fix a collapsed and dangerous city. A city where the popular DJ Warras was murdered in broad daylight just last month.

A Zille victory wouldn’t surprise me. She is a smart, courageous politician, and Johannesburg residents are no fools. They have had enough of mismanagement, disastrous service delivery, and the total lack of public safety. According to the latest polls by Social Research Foundation (SRF), she’s already doing well.

Should she win and successfully revitalize Johannesburg—Africa’s wealthiest city—the DA will be well-positioned for the 2029 general elections.

DA to hold its Federal Congress

The Democratic Alliance (DA) holds its Federal Congress this April. John Steenhuisen is seeking re-election. The DA received 20.77% of the national vote in the 2019 general election. Under John, who took power in November 2019 – after the general election – the party received 21.81% in the 2024 general election.

I respect Steenhuisen and have met him twice by coincidence. He’s a very nice person. However, I don’t believe he has been effective in the Government of National Unity. In my view, the DA should have secured a stronger deal during the 2024 coalition negotiations. Moreover, Steenhuisen has failed to challenge the ANC on its foreign policy, allowing it to persist with a disastrous course. If Cape Town’s Geordin Hill-Lewis and Solly Malatsi enter the DA leadership race ahead of the Congress, Steenhuisen could face serious trouble.

The MK Party is desperate for power in KZN

I’ll be watching KwaZulu-Natal (KZN) politics closely. The MK Party has been working aggressively to destabilize the Government of National Unity in the province. Last month, they tabled a vote of no confidence in the Premier, Thami Ntuli. He survived the vote, which came as a relief to those uneasy about the MK Party.

Then, earlier this month, something more concerning happened: the National Freedom Party (NFP) withdrew from the provincial coalition government. The withdrawal places the provincial government in a precarious position. The 80-seat legislature is now effectively deadlocked. Without the NFP’s backing, the governing coalition falls short of the required majority (50% + 1), leaving it vulnerable. It may struggle to pass budgets or withstand future motions of no confidence unless a new agreement can be negotiated.

The MK Party secured the most votes in KZN in the 2024 elections—45.35% of the total. Behind was Inkatha Freedom Party (IFP) with 18.07% of the total provincial vote. That’s a huge gap. On that basis, they can argue that they deserve to govern the province. So, don’t be surprised if KZN ends up under MK Party leadership this year

Economic Realities in 2026

On South Africa’s economy, I expect the momentum from last year to continue, boosted by the commodities boom. However, I must emphasise: a commodity boom without stronger pro-market reforms will not push South Africa to 4% or 5% growth. Much of last year’s “positive news” was a result of global investor appetite for commodities and a weaker dollar rather than Ramaphosa’s reforms.

Emerging markets have enjoyed renewed momentum since April 2025, supported by firmer commodity prices and a softer US dollar. According to the South African Reserve Bank’s December 2025 Monetary Policy Review, these conditions have eased financial pressures and boosted returns — with South Africa among the beneficiaries.

Rand Merchant Bank (RMB) projects South Africa’s economy to expand by 1.5% in 2026, supported by easing inflation and anticipated SARB rate cuts that should boost household spending. Inflation averaged 3.2% in 2025—the lowest since 2004—creating significant scope for monetary easing this year. RMB expects a 50 basis point reduction in interest rates in 2026.

The rand is expected to remain firm through 2026. RMB sees room for further short‑term gains against a weak US dollar, supporting the currency’s strength during year 2026.

While load shedding has eased, electricity costs have skyrocketed, hurting South African households and businesses alike.

Our bigger economic problems remain structural: skill shortages, law and order breakdowns, rigid labour markets, high taxes, and over-regulation. Debt service costs are now consuming 22% of tax revenue. Compared to our global peers, we are in deeper trouble. All these things won’t be addressed this year.

One last thing: watch out for Donald Trump’s sanctions on ANC leaders this year. – PM