United in difference

Observations on South Africa

Revelling in the blend of Marxist-Leninism and free-market rhetoric on offer at the African National Congress's five-yearly policy conference, which opened on 27 June, one veteran observer of the British political scene said it reminded him of Labour party conferences in the Eighties.

On balance I think he was a little glib. South Africa's ruling party, like Labour in the past, may be torn between its left-wing history and the blandishments of the free market, but I cannot believe there was ever a tenth as many Mercedes and convertibles at any Labour conference as there were parked outside the ANC's four-day gathering.

With the party divided into two bitterly opposed camps - loyalists to the market-friendly President Thabo Mbeki and backers of the populist Jacob Zuma, the figurehead of the left - the president was facing possibly the most awkward audience in the ten years since he became party leader.

He did not shrink from the challenge. After months of sniping from leaders of the South African Communist Party (SACP) and trade unions about his economic policies, he did his best to put the critics in their place - and then to present a united front.

It came as little surprise that a move by the radicals of the ANC Youth League, to brand "monopoly capital" the enemy of the ANC's "revolution", came to naught. But it must have been tempting for Mbeki to take a more conciliatory stance towards the demands by grass-roots organisations for a more interventionist approach to the economy. As it turned out, he was unbending. So all those investor ratings agencies and would-be investors who still, unfairly in my view, cling to the early post-apartheid notion that South Africa might change course at any moment, can relax.

That said, however, it would be wrong to conclude that the party and its traditional allies, the unions and the SACP, are united. Rather, the alliance is wracked by its greatest turmoil since the ANC was legalised by the last white president, F W de Klerk, in 1990.

It is simplistic to see this as a right-left split. The propaganda of the two sides claiming this is a battle between Stalinists and Thatcherites is wide of the mark. Mbeki's government long ago abandoned privatisation. And the left, while it has seized on figures that highlight the continuing huge wealth disparity in South Africa 13 years after the end of apartheid, is not arguing for nationalisation.

Also, it is not just the comrades "deployed" into business, as the party likes to say, who are driving the fancy cars parked outside the conference centre. Many of the SACP's leaders are also fond of a designer lifestyle, as the party's treasurer general, Philip Dexter, pointed out in a recent damning memo. Many behave like the ANC's business "moguls, driving 4x4s, living in exclusive neighbourhoods, sending their children to private schools", he wrote. He clearly hit a nerve. Since the memo was leaked, Dexter has been suspended.

But despite these ambiguities and ties between the two factions, there is a battle for power raging, the likes of which the ANC has not seen since it took office. After narrowly staving off a motion to block him from running again for the party's leadership at its elections in December, Mbeki marched to the microphones of state television and made clear, for the first time, that he intended to run. He is determined to stop Zuma, the party's deputy president, from succeeding him.

The constitution bars him from running again as national president in the 2009 elections, but if he were to stay on as party leader he could all but appoint the party's candidate and, in effect, given the ANC's electoral dominance, the next head of state.

A month or so ago, Mbeki seemed to be in the ascendant and Johannesburg's political classes assumed that if he wanted a third term as party leader, it was all but in the bag. Now I am not so sure. He is a wily backroom politician, but there was an angry anti-Mbeki mood at the conference.

It was, to use a more up-to-date Labour analogy, reminiscent of the anti-Tony Blair mutterings in the party's grass roots in recent months. And the image of those flashy cars lined up alongside the coaches that had brought in the humbler delegates from the regions sent out a powerful signal, however unfair that may be.

For any potential "compromise" candidate for the ANC leadership, hoping for deadlock between the party's two Titans, the weekend could not have gone better.

Alec Russell is the Financial Times's Southern Africa correspondent