South Africa: Current Developments and U.S. Relations

South Africa: Current Developments and U.S. Relations

Updated February 15, 2018
South Africa: Current Developments and U.S. Relations
On February 14, 2018, South Africa’s second term
Widespread criticism of Zuma’s leadership, however, had
president, Jacob Zuma, resigned—after defying an order by
increasingly appeared to be undermining popular support
the executive committee of the governing African National
for the ANC, despite its historic anti-apartheid role. This
Congress (ANC) that he do so, and in the face of a
generated increasing concern within the ANC over the
threatened no-confidence vote in parliament. The
electoral implications of Zuma’s continued leadership. Tied
parliament then elected as national president Cyril
to this was what some observers called a “crisis of
Ramaphosa, then national vice president, whom the ANC
expectations,” in which the state has been seen as
had chosen to succeed Zuma as its party leader in late 2017,
inadequately addressing post-apartheid public demands for
ahead of general elections in 2019. Zuma’s departure came
rapid socioeconomic transformation. As a result, opposition
after years of pressure on him to step down, spurred by
parties have made steady electoral gains. The Democratic
chronic corruption scandals and weak economic growth
Alliance (DA) holds 89 seats and the radical Economic
under his tenure. It also capped an effort by Ramaphosa, in
Freedom Fighters (EFF) 25 seats. The EFF’s rise has been
the face of an intra-ANC split between pro- and anti-Zuma
rapid; formed in 2013 by Julius Malema, a former dissident
wings, to immediately succeed Zuma.
ANC youth leader, it is now the third largest party in
parliament. It often harshly criticized Zuma and repeatedly
Country Background
disrupted his parliamentary addresses.
South Africa, which became a multiracial democracy in
1994, is influential in Africa, due to its size, resources, and
Ending Controversy and Tumult Under Zuma
investment and political engagement across the region—but
Ramaphosa’s swearing-in ends questions over whether
suffers from deep internal socioeconomic divisions. There
Zuma might have remained national president until general
has been progress toward racial equality since the first all-
elections in 2019 (as constitutional term limits would have
race election in 1994, which marked the end of apartheid, a
permitted), and may open the way to Zuma’s prosecution
system of legalized racial discrimination favoring the white
on corruption charges (see below). Ramaphosa, whose
minority. The deep inequality and poverty apartheid
election has been widely welcomed, has pledged to address
created, however, endures—despite diverse efforts by the
corruption and the faltering economy, and other key
ANC to redress its effects. Inequality continues to be borne
challenges. Zuma’s departure ushers in an end to a series of
primarily by the black majority, 80% of the population,
high-profile state corruption controversies and alleged
which suffers high unemployment, low incomes (about 1/6
commercial favoritism under his tenure, which had spurred
that of whites), and the lowest rates of education.
fierce intra-ANC and inter-party political competition and
harsh criticism of his leadership.
South Africa has the third largest and most industrialized
economy in Africa, and is a major mineral producer, but
years of anemic economic growth have hampered efforts to
reduce poverty and income inequality. Despite massive
investments in housing, social services, education, and
infrastructure, public service quality has often been poor,
spurring many protests. Some have been violent, as have
some strikes by miners and mass student protests over
higher education costs. Violent crime is also a key problem.
Broader challenges to social cohesion, often tied to
socioeconomic marginalization and resentment among the

poor, are reflected in periodic xenophobic attacks on
Zuma had entered office with substantial political baggage
African immigrants and their businesses, attacks on white
(e.g., acquittal in a controversial rape trial and corruption
farmers, and widespread de facto racial segregation. Many
allegations) and faced years of public discontent over a
poor blacks and mixed race “coloureds” live in informal
state-funded upgrade of Nkandla, his private home
housing in “townships,” while the wealthy often live in
compound. In March 2016, a Constitutional Court found
highly secured, gated communities. A final key challenge is
that he had violated the constitution by defying a legally
the high HIV/AIDS adult prevalence rate (18.9% in 2016).
binding finding by former Public Protector Thuli
Politics
Madonsela, requiring him to pay for some of the cost.
Madonsela repeatedly used her post, akin to a state
Since 1994, the ANC has held a parliamentary majority
ombudsman, to probe malfeasance under Zuma’s tenure
and, as parliament elects the president, controlled the
and was seen as a key check on his exercise of state power.
executive branch. The party won 249 of 400 seats (62.3%)
The opposition DA then used her ruling as a basis for an
in general elections in 2014, after which the parliament
unsuccessful attempt to impeach Zuma. A High Court also
reelected Zuma to a second five-year term as president.
ordered the National Prosecuting Authority to review its
https://crsreports.congress.gov

South Africa: Current Developments and U.S. Relations
2009 dismissal of a 783-count corruption case against Zuma
Zuma’s leadership. Zuma survived an August 2017 vote on
linked to a 1990s arms purchasing scandal. Zuma may now
the matter, the sixth such effort, by a slim margin.
face trial in the matter.
U.S.-South Africa Relations
Zuma was widely seen as allowing and sometimes
U.S.-South Africa relations are generally friendly, despite
facilitating the use of state-owned enterprises (SOEs) and
residual ANC distrust stemming from apartheid-era U.S.
connections to the ANC to advance private gain for his
policies and periodic contemporary foreign policy
family and political loyalists. Notable alleged recipients
differences. South Africa, for instance, has opposed U.S.-
have been a network of ANC and business interests related
backed international interventions in Iraq and Libya, and
to Zuma, his relatives, and the Guptas—an Indian émigré
differed with U.S. stances on Cuba, Palestine, and Iran.
family closely tied to him. Such dynamics have prompted
South Africa also did not arrest Sudan's president, Omar al
extensive concern over “state capture,” the focus of a
Bashir, on an International Criminal Court warrant for
damning 2016 Public Protector’s report. The term refers to
genocide and other crimes, when he attended a 2015
allegedly systematic collusion between top state officials
African Union summit in the country. The United States
and private firms to influence and even control SOEs, state
supports execution of the warrant.
regulatory processes, and public fiscal assets to advance
In other cases, the two countries have often, if not always,
their joint interests through lobbying and corrupt acts.
concurred on political or military crises in Africa. Under the
Obama Administration, the two governments pursued
Politicization of Economic Leadership Under Zuma
development and defense cooperation and a bilateral
Steady economic leadership is arguably crucial if South
Strategic Dialogue, begun in 2010. It focused on health,
Africa is to reverse five years of declining economic growth
education, food security, law enforcement, trade,
(0.3% decrease in 2016) and rising unemployment. Zuma,
investment, energy, and nuclear nonproliferation. South
however, changed finance ministers five times since 2014,
Africa twice hosted visits by then-President Obama and
in a manner that his critics alleged had prioritized his
participated in his 2014 U.S.-African Leaders Summit. In
political and economic interests over those of the national
early 2017, President Trump and Zuma spoke by phone on
economy. Notably controversial was his sudden late 2015
trade expansion, African peace and stability, cooperation on
decision to replace the generally well-respected then-
counter-terrorism, and multilateral issues—all traditional
Finance Minister, Nhlanhla Nene, with a little-known MP,
foci of bilateral relations.
David van Rooyen. Nene's opposition to a large, costly
Zuma/Gupta-backed nuclear plants building plan and
Trade and Aid
negation of a large, opaque South African Airways (SAA)
South Africa is a key U.S. African trade partner, but trade
aircraft leasing deal, and other factors, reportedly prompted
levels have steadily declined, from $16.8 billion in 2011 to
the change. A strong negative market response followed, as
$11.4 billion in 2016 (-28.7%). South Africa's trade with
did protests and intense, broad-based criticism.
the world fell by about the same proportion (from $250
billion in 2011 to $179 billion in 2016). South Africa was
Zuma then replaced Van Rooyen with Pravin Gordhan
the second-largest exporter to the United States under the
(finance minister from 2009 to 2014 during Zuma’s first
African Growth and Opportunity Act (AGOA) in 2016, but
term). Markets responded positively to Gordhan’s
its use of AGOA tariff benefits has fallen in recent years. Its
appointment of Gordhan. He affirmed Nene’s nuclear build
continued AGOA eligibility was made subject to review
and SAA deal decisions, acted independently of and even in
under P.L. 114-27, which extended and amended the Act.
defiance of Zuma, and harshly criticized governance under
At issue was a bilateral trade dispute over South African
Zuma—suggesting that growing unethical, corrupt
restrictions on imports of U.S. meat products. The dispute
business-state ties might turn South Africa into a
was resolved in 2016; South Africa lifted the restrictions
kleptocracy. Controversy also erupted in March 2016 after
after intensive dialogue under the review.
the deputy finance minister reported that the Guptas,
Since 1992, South Africa has been a top African recipient
purportedly in concert with Zuma, had offered him $47
of U.S. development aid, but levels have fallen in recent
million to take the ministerial post under an implicit quid
years, from $515 million in FY2013 to $470 in FY2017.
pro quo deal before Nene’s firing.
The Trump Administration requested $311 million for
FY2018 and $225 million for FY2019. HIV/AIDS and
A growing power struggle between Zuma and Gordhan
healthcare system aid have been longstanding objects of aid
came to a head in March 2017, when Zuma, in a highly
and congressional oversight. South Africa also received
controversial move, replaced Gordhan and several other
limited aid under the Obama Administration’s Power Africa
ministers seen as opposed to Zuma. Gordhan’s successor,
and Global Climate Change initiatives, and under regional
Malusi Gigaba, lacks financial sector experience, and
programs. Non-health aid has targeted education, varied
initially spurred business concern by echoing Zuma’s calls
efforts to increase government accountability and access to
for swift “radical economic transformation.” After his
justice, and policy development focused on youth
selection, two major credit agencies lowered South Africa’s
unemployment, economic competitiveness, and public
debt rating to “junk” status. Many analysts saw Gigaba’s
service delivery.
appointment as a sign of continuing Gupta influence and as
exemplifying Zuma’s naming of reportedly pliant political
Nicolas Cook, Specialist in African Affairs
loyalists to top state posts. Gordhan’s firing split the ANC
leadership and spurred mass anti-Zuma protests and an
IF10731
opposition-initiated no confidence motion in parliament on
https://crsreports.congress.gov

South Africa: Current Developments and U.S. Relations

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
United States Government, are not subject to copyright protection in the United States. Any CRS Report may be
reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include
copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you
wish to copy or otherwise use copyrighted material.

https://crsreports.congress.gov | IF10731 · VERSION 5 · UPDATED