How Markets Control and Shape Politics in South Africa: GNU & Capital’s Grip

The Tyranny of Capital: How Markets Control and Shape Politics in South Africa

South Africa was once a shining symbol of hope. It was a miracle of democracy rising from the ruins of apartheid. Now, it languishes in the grip of an invisible oppressor. The 2024 elections should have amplified the voice of the people. Instead, they laid bare a bitter reality. Democracy here is not moulded by the will of voters. It is shaped by the cold calculations of boardrooms in Sandton. The trading floors of the Johannesburg Stock Exchange have an impact too. Moreover, the whims of global investors in London and New York play a role. The markets control and shape politics. They also shape them. The Government of National Unity (GNU) stands as a glaring testament to this betrayal.

The Election That Wasn’t

When the ballots were tallied in May 2024, no party secured a clear majority. The ANC, bruised by decades of corruption and mismanagement, limped to 40% of the vote. The DA, EFF, and smaller parties jostled for influence in a fractured political landscape. In a true democracy, this uncertainty would have sparked a vibrant debate.

It led to a negotiation focused on the urgent needs of the people. These needs include jobs, housing, healthcare, and an end to crippling inequality. But that’s not what happened. Instead, the political elite turned not to the electorate but to capital. The markets control and shape politics, and they demanded a “business-friendly” coalition to calm their nerves and safeguard their profits.

In a truly democratic society, governments answer to voters, not investors. Yet in South Africa, the reverse is true.

A Confession of Priorities

Helen Zille, the DA’s federal chairperson, let the truth escape in a rare moment of candour. She admitted that the GNU was formed because that’s what “most of the business community wanted”. This wasn’t a casual remark; it was a confession, a raw glimpse into a system that has forsaken its people. The GNU was not a democratic answer to a hung parliament. It was a market-calibrated product.

It was engineered to reassure investors, stabilise asset prices, and guarantee policy continuity. The markets control and shape politics. The GNU is their brainchild. It is a coalition crafted not to redistribute power or wealth but to restore “investor confidence”. It also signals a return to orthodox, market-pleasing governance.

A Fleeting Illusion of Hope

For a brief, deceptive moment, the markets rejoiced. South African bonds rallied, equities soared, and the rand strengthened against the dollar. Asset managers like Allan Grey and Coronation called the GNU a victory of “market rationality”. They saw it as a commitment to structural reform and a lifeline for fiscal stability.

Business editorials gushed with optimism, casting the coalition as a new dawn for South Africa. But this euphoria was a mirage. It was a narrative spun to convince us that a market-friendly government would deliver growth, jobs, and prosperity. The markets control and shape politics, but their promises are empty, built on fleeting sentiment rather than tangible change.

The Data Tells the Truth

The reality, as always, is harsher than the hype. No significant reforms have emerged in the year since the GNU took power. GDP forecasts, once lifted by post-election optimism, have been slashed. The IMF and World Bank now project growth of less than 1.5% for 2025, too anaemic to tackle the unemployment crisis. Infrastructure roads, railways, and power lines continue to rot, with Eskom’s blackouts and Transnet’s logistical failures strangling the economy.

Unemployment, a national disgrace at 32.9% in 2024, remains stubbornly high. The February 2025 budget involved painful compromises. It included cuts to social spending and wage freezes for public servants. There was a refusal to embrace bold fiscal stimulus. The markets control and shape politics. Their influence is etched into this austerity. This prioritisation of bond yields comes before human lives.

The Rally Fades, the Pain Endures

In June 2024, the markets celebrated the GNU with a giddy fervour. The JSE All Share Index climbed 3% in a week, and the rand gained 2% against the dollar. But this rally, like the coalition itself, was a bet on emotion, not substance. Now, the illusion has crumbled. Market analysts report that local equities have stalled.

The bond market has cooled. The rand has weakened again and is hovering at R18.50 to the dollar as of June 2025. Asset managers, once eager to praise the GNU, now warn investors against “herd behaviour” and urge caution. The markets control and shape politics. When the fairy tale unravels, they flee. This leaves the public to bear the burden.

The GNU was formed because that’s what ‘most of the business community wanted’.
Helen Zille

A Coalition for Capital

The damage is done. South Africa is now governed by a coalition. It is shaped not to address the crises of poverty, inequality, and exclusion. Instead, it is designed to appease capital. The GNU is not a product of mass mobilisation or public consultation. It reflects investor preference. It is a political formation forged in the ruthless logic of finance. The markets control politics. They shape politics. Their influence is a suffocating force.

It dictates not just the makeup of government but also the policies it dares to pursue. Political decisions, in this twisted system, are valid only if they win market approval. A government that prioritises the poor and invests in social housing face risks. Investments in universal healthcare ignite the wrath of bond traders and currency speculators. This is the real story: the GNU exists not because the people chose it but because the markets demanded it.

The Private Sector as Kingmaker

In effect, the private sector has become South Africa’s kingmaker. The 2024 election delivered ambiguity, a hung parliament that was a canvas for bold, people-centred governance. But capital demands clarity, not democracy. A “business-friendly” coalition was summoned. Its purpose was not to fulfil the will of the people. Instead, it aimed to stabilise sentiment on the JSE and soothe risk analysts in Sandton and London. The markets control and shape politics.

Their priorities are low deficits, tight monetary policy, and “structural reforms.” These often mean privatisation and deregulation. They have become the guardrails of governance. The public is left with a government that can’t pursue radical redistribution. It is obsessed with “confidence-building” rather than justice. Its fiscal policy is chained to conservatism, rather than meeting the urgent needs of the masses.

Disciplining Democracy

This is how the markets discipline democracy. We saw it during the “9 Wasted Years” of Jacob Zuma’s presidency. During this period, credit rating agencies downgraded South Africa to junk status. The agencies punished the government for corruption and mismanagement. But the discipline runs deeper now. The markets control and shape politics not just by punishing governments that disobey but by installing ones that won’t.

The GNU is not a compromise between political parties; it is a compromise with capital. And like all such compromises, it leaves the majority, including the unemployed, with nothing but more promises. The underpaid and the marginalised are left with more delays and more discipline. The dream of a better life for all was once the ANC’s rallying cry. It has been replaced by the sterile mantra of “market stability”.

A Government for Investors, Not Voters

In a truly democratic society, governments answer to voters, not investors. Yet in South Africa, the reverse is true. The GNU is not a coalition of political parties. It is a coalition of capital, serving the elite’s interests. Policy is shaped not by the cries of the poor, but by the fluctuations of bond yields. A basic income grant can lift millions out of poverty.

It is dismissed as “fiscally irresponsible” because it will spook investors. Plans to nationalise failing state-owned enterprises or invest in renewable energy are shelved because they will disrupt “market confidence”. Markets control and shape politics. Their veto power is absolute. It is a silent but omnipresent force that strangles the hopes of a nation.

The People’s Pain

The anger and sadness of this moment are raw and real. Walk through the townships of Soweto or Khayelitsha, and you’ll hear the frustration. Promises of jobs and houses are made election after election. They stay unfulfilled. Drive past the rusted railway lines. See the crumbling power stations. You’ll see the decay of a state too timid to invest in its future. Speak to the unemployed graduates, the single mothers, and the retrenched workers. You’ll feel the weight of a system that values stock indices over human dignity. The markets control and shape politics. Those who can least afford it, the poor, the vulnerable, and the forgotten, bear the cost.

A Glimmer of Hope?

What, then, is the way ahead? Can South Africa break free from the tyranny of capital? It’s a daunting task, but not an impossible one. A government brave enough to defy the markets, to focus social spending over fiscal austerity, can start to rebuild trust. A coalition truly accountable to the people will invest in infrastructure, education, and healthcare.

This would not consider the JSE. Such actions can lead to short-term market turbulence. Civil society, trade unions, and grassroots movements must rise, demanding a politics that serves the public, not the private sector. The markets control and shape politics, but they do not have to. The power to change this lies with the people if only we can muster the courage to reclaim it.

A Nation in Mourning

For now, the story is one of loss and rage. The GNU is sold as a triumph of unity. It is a monument to capitulation. This government is shaped not by the will of the people but by the demands of capital. We deserve better. South Africa deserves a democracy where the ballot box, not the bond market, determines our future. Until that day comes, we will live under the shadow of a system where the markets control and shape politics. The dreams of millions are left to wither in the dust.