What lies ahead?

So how is the "status quo outcome" of Mangaung going to shape South Africa's economic and political outlook?

President Jacob Zuma was re-elected as ANC party president. This suggests that he will remain president until 2019, as it is expected that the ANC will win the 2014 general election. However, while Zuma managed to defeat his rival Mbeki in 2007 by portraying himself as "the president of the common person," his more recent actions indicate that he has lost touch with the nation's people, 40 percent of whom live under the international poverty line. With his reputation tarnished by various scandals and his questionable track record over the past three years, a likely second term as president will provide an opportunity to redeem himself.

Cyril Ramaphosa's win over Kgalema Motlanthe at the Mangaung meeting, making him eputy president of the ANC and a likely vice president pick for the 2014 election, does not reflect the preferences of the common person. Instead, his election has been widely touted as indicative of the rising black middle class (nearing 5 million) – something that the only substantive opposition party, the Democratic Alliance (DA) led by the recently re-elected Helen Zille, has been targeting with great success.

As a highly successful black businessman and second in command at the National Planning Commission (NPC), Ramaphosa's return to politics will be palatable to the markets and bolster international investor confidence in South Africa. His NPC position brings much-needed credibility to the ANC's economic and social policies, particularly given his strong support of the NPC's National Development Plan (NDP) Vision for 2030, which he has identified as a key policy for the future. Containing no broad changes to economic policy, apart from a marginal shift toward a greater "developmental agenda," the NDP was widely accepted at Mangaung. The question will be how Ramaphosa, amongst others, can bring about the swift implementation of this plan, as uncertainties, including calls for nationalization, have fallen away.

Ramaphosa's position could also strengthen the ties between government and business. In comparison to its BRICS peers, especially China, South Africa is at a great disadvantage due to the disconnection and lack of trust between the corporate sector and the government. This particularly hampers the nation's competitiveness and its ability to protect its commercial interests abroad, especially on the African continent – a vital and growing market for South African corporations, and an important part of the country's long-term growth.

Developmental vision

It will be crucial for the Zuma Administration to bring about tangible change in the coming years to satisfy the country's increasingly impatient population. As the dividends of democracy have been few and far between, South Africa is in need of capable and competent leadership to steer the country onto a winning developmental path. Zuma's probable second term as president will need to involve positive changes and a commitment to placing the interests of the population above those of the party. Otherwise, the ANC may find itself facing a rude awakening at the ballot box. The recent labor strikes have only underlined that the ANC has not been able to deliver on the many ambitious promises that it has made over nearly 20 years.

Overcoming its internal divisions and changing how it does business to address spiraling challenges will be important if the ANC seeks to build confidence and foster faster and more inclusive growth. This means more actively striving to achieve the country's long-term developmental vision, and continuing to court international partners. The ANC will then need to focused on creating employment opportunities for the country's youth, building a better education system, actively nurturing talent, fostering entrepreneurship and investing in infrastructure and institutions to create opportunities in leading sectors. The party must dedicate itself to making South Africa a more competitive and prosperous society.

Otherwise, the people residing in the economic powerhouse of South Africa will soon become dissatisfied with their leadership and how their vision has caused the nation to squander the potential that many of its African peers are already unlocking. CA

(Hannah Edinger is Head of Research & Strategy at Frontier Advisory. Simon Schaefer is Senior Analyst at Frontier Advisory - http://www.frontier-advisory.com )