That was fast! The post-Mbeki government felt international financial sanctions even before taking office.   

Whatever the motives for Trevor Manuel’s on-off resignation last week, it may turn out to have been a blessing in disguise in showing the country’s new leadership the high costs of antagonising international markets. Though it was his own reckless action that caused both the rand and share prices on the JSE to tumble before he made clear his willingness to serve in the new cabinet, Manuel may find himself stronger now than before in relation to militant forces in the tripartite alliance comprising the African National Congress (ANC), the South African Communist Party (SACP), and the Congress of South African Trade Unions (Cosatu). 

Manuel’s reputation, and foreign confidence in the Mbeki government, was built on his achievement of fiscal prudence, one of the policies the militants would like to see jettisoned.  He will now be able to show them forcefully just how fragile sentiment towards South Africa has become. If trade union proposals to nationalise Sasol, for example, ever made it to the parliamentary agenda, the price could be paid in an irretrievable loss of confidence in this country, a flight from the rand and the JSE, and an unsustainable current account deficit necessitating an economic clampdown that drastically pushes up worker retrenchments.

Following the market tsunami precipitated by the Manuel ‘resignation’, even the SACP expressed anxiety about ‘the stability of the country’ and ‘the standing of SA internationally’, while the ANC youth league  - nogal – hastened to offer the assurance that Manuel would ‘still be available to serve in government’. 
 
Since the ANC commands such a large parliamentary majority, international investor opinion is an especially important countervailing force. Given the instantaneous and brutal global reaction to the resignation, the new cabinet will have to think twice before giving effect to some of the threats voiced by Jacob Zuma’s supporters against the judiciary, the national prosecuting authority, and the rule of law. The shelved Expropriation Bill, with its comprehensive threat to a whole range of different property rights - cannot now be re-introduced quite so easily. Manuel will also be in a stronger position to resist left-wing empowerment demands that would undermine the stability of the banking system.

Moeletsi Mbeki quoted a ratings agency as asking, ‘Where are you guys going? You are a big-risk country as it is, and you are playing with fire’. The implication is that South Africa is now on probation and will not easily be given a second chance should the new government undermine confidence. P W Botha, the tripartite alliance may care to remember, was not given a second chance after his Rubicon speech in August 1985. 

The stronger the influence wielded on the Motlanthe government by the SACP and Cosatu the more risk there will be of adverse market consequences. The two have long demanded a greater institutionalised say in government policy. They also want more places on ANC electoral lists. Their demands are sheer chutzpah, of course. They seek to arrive in Parliament via ANC lists instead of putting themselves up as candidates and fighting elections under their own colours. Another demand is that SACP and Cosatu members who get to Parliament on ANC lists be subject to SACP and Cosatu discipline. Kgalema Motlanthe and the ANC would be fashioning rods for their own backs were they to accord the militants the greater say they want.

Although much of the revolt against Thabo Mbeki was the result of his failure to defer to Luthuli House, Motlanthe is likely to discover – he no doubt knows it anyway – that the demands of running a country transcend the narrow interests of a party elite that seeks to run it using the obsolete Soviet model of governance.           

Given the country’s pressing needs, can Motlanthe afford simply to be a compliant caretaker? And if he is successful in addressing some of those needs, how will he and the ANC explain why he is quitting the presidency after the general election next year to hand the job over to a man with a cloud of unresolved charges hanging over his head?