Weekly political compass 5.20.24 | Teneo

Welcome to this edition of the Weekly Political Compass from Teneo’s political risk advisory team.

This week we will go into it in more detail South Africa’s approaching elections. Meanwhile key East Asian leaders will meet in Seoul, and talk of a cabinet reshuffle is likely to increase Turkeytax reforms and disaster relief to the southern regions will be the focus BrazilAnd Senegal could call for the departure of French troops. Our chart of the week zooms in on the support of the European population for help Ukraine further.

Global snapshot

In South Africa, the campaign will have its final countdown in the run-up to the national and provincial elections of May 29. Our Africa expert Anne Frühauf analyzes the situation.

What are the prospects for the remaining campaign days?

Party leaders will tour the country ahead of the final weekend campaign rallies, but election day turnout will be even more important. While polls continue to suggest the ruling ANC will fall below 50% of the national vote share for the first time, the party has built momentum in recent weeks that could put it within reach of a result above 45%. After an initial period of uncertainty and unrest, such an outcome should allow the party to form a working majority, with support from smaller parties. However, the ANC appears set to lose its provincial majorities in Gauteng and KwaZulu-Natal (KZN), which may necessitate more complex, less market-friendly coalition deals.

To what extent will the Zuma factor disrupt the elections?

While the 2024 elections will be marked by widespread fragmentation and the emergence of many new opposition parties, ex-president Jacob Zuma’s breakaway party uMkhonto weSizwe (MK) is the biggest uncertainty looming in the polls. MK seems to have lost some momentum in recent weeks due to infighting. Nevertheless, the country held a major rally in Johannesburg this weekend and continues to be a highly disruptive factor, especially in KZN and, to a lesser extent, Gauteng and Mpumalanga.

The Constitutional Court today ruled that Zuma is ineligible for parliament given the prison sentence he has received over the past five years. This will be a blow to MK, but his image will remain on the ballot papers, which will attract votes. The ruling also fuels the risk of new unrest in a party that has little respect for the rule of law and has everything to gain from maximum disruption.

What to watch


East Asia

The first joint summit since 2019 between the leaders of China, Japan and South Korea is expected to take place in Seoul from May 26 to 27. With trilateral trust chronically low, the agenda is expected to focus on uncontroversial cooperation measures in areas such as trade and investment, public health and sustainable development. Tougher topics such as ties with North Korea or Beijing’s continued ban on Japanese seafood imports are unlikely to make progress. China’s longer-term goal is to drive a wedge between the respective alliances of Japan, South Korea and the US – a task that could become easier if a Trump 2.0 presidency imposes universal tariffs or follows through on threats to withdraw US troops from South Korea. .


The Commerce Department on Sunday launched an anti-dumping investigation into engineering plastics imported from the US, EU, Japan and Taiwan. The trade investigation appears to be a response to US tariffs imposed last week on Chinese-made electric vehicles (EVs) and other imports; an EU investigation into Chinese tinplate announced on Friday; and ongoing EU anti-subsidy investigations into Chinese electric vehicles, wind farms, solar companies and railway companies.


The National Assembly is expected to approve the election of Public Security Minister To Lam as the country’s next president on May 21. Traditionally, the largely ceremonial post of president has been the consolation for a faction or individual that has lost in the battle for the country’s two top leadership positions: general secretary of the Communist Party and prime minister. The nominal winner is Prime Minister Pham Minh Chinh, who is competing with To Lam to become general secretary in 2026. However, given the fluid and opaque nature of Chinese leadership politics, the maneuvering between the two politicians may not be over.



Rumors of a cabinet reshuffle are likely to increase as the ruling Justice and Development Parry will hold its annual labor camp in Kizilcahamam from May 31 to June 2. At this meeting, the AKP is expected to determine its future strategy in the wake of the defeat in the March 31 local elections. It is unlikely that a cabinet reshuffle will have any impact on the current economic team.


Although President Volodymyr Zelensky’s term ends on May 20, he will remain in office until a newly elected president takes office. However, the country’s laws do not allow elections to be held during martial law, which has been regularly extended by parliament since the start of Russia’s large-scale invasion on February 24, 2022. Nevertheless, Russia is likely to raise questions about the legitimacy of the Ukrainian president and the entire government.



It is unlikely that a governability pact, scheduled for May 25, will be signed as President Javier Milei originally envisioned. The idea was to organize a grand event attended by Milei, provincial governors and trade unions, all of whom would sign a list of ten principles and pledges. These include a pledge to keep government spending at no more than 25% of GDP. However, the ‘May Pact’ was conditional on the passage of the ‘basic law’ – a package of reforms including tax, labor and other measures – which remains stalled in the Senate, where the ruling Liberty Advances (LLA) party has only ten percent of the seats. The government has postponed the “May Pact” until June or July, assuming that the reforms will pass the Senate by then. In the meantime, Milei may hope that an increasing diplomatic row with Spain will be a useful distraction from his domestic political problems; Madrid recalled its ambassador yesterday, May 19, after Milei alluded to the Spanish Prime Minister’s wife being “corrupt” during a conference organized by Spain’s far-right VOX party.


This week, Congress will focus on tax reform and expanding wage benefits for corporations and municipalities, while continuing to focus on disaster relief in the South. The tax reform framework was approved in December 2023, but has made little progress toward passage of additional legislation in Congress since then. The government introduced a first supplementary bill (PLP) on April 24 that addresses the regulation and rates of the new federal and sub-federal VAT, leaving the distribution of revenues among federal entities to a second PLP. House Speaker Arthur Lira should announce related working groups this week and Treasury Secretary Fernando Haddad should attend a public hearing on May 22 to discuss the reform. The fight between the administration and Congress over the extension of wage benefits has been put on hold in the courts for 60 days, and Congress may vote on the existing bills this week. The government will continue to announce relief measures in the context of the catastrophic flooding in the southernmost state of Rio Grande do Sul.



Senegal could become the next country in West Africa to call for the departure of French troops from its territory. This comes after newly appointed Prime Minister Ousmane Sonko’s statement last week, in which he noted that the presence of French military bases in Senegal “raises legitimate questions, more than sixty years after our independence.” However, in what was clearly an attempt to allay potential fears that an expulsion of French troops is a widely held view in government circles, Sonko was keen to emphasize that his statement was made in his capacity as leader of the Patriots of Senegal (PASTEF) . ) party.

Chart of the week

As Russia progresses UkrainePressure is increasing on European countries to provide additional economic and military support, following the approval of a significant military aid package by the US Congress last month. Despite French President Emmanuel Macron’s suggestion of possible deployment of Western troops, this remains unlikely. In fact, Europeans are skeptical of this approach; no more than 30% of the population of any country supports this approach. Conversely, there is more support for increasing military aid in most Nordic and Baltic countries, as well as in Poland, Spain and Portugal. However, those in Italy, France and Germany, Ukraine’s biggest European backer, appear less willing to further increase military aid. Against this backdrop, discussions on alternative solutions, such as tapping into the profits from Russia’s frozen state assets, could gain momentum again.

The views and opinions expressed in these articles are solely those of the authors and do not necessarily reflect those of Teneo. They are provided for the purpose of stimulating thought and discussion and not as legal, financial, accounting, tax or other professional advice or advice.