South Africa's ANC aims to announce new leader on Sunday

By Alexander Winning and Mfuneko Toyana JOHANNESBURG (Reuters) - South Africa's ruling African National Congress (ANC) expects to announce Jacob Zuma's successor as party leader on Sunday, a spokesman said, concluding a bruising leadership battle that threatens to tear it apart before a 2019 election. The race between Deputy President Cyril Ramaphosa and Nkosazana Dlamini-Zuma, a former cabinet minister and ex-wife of President Zuma, the two frontrunners to replace Zuma, is too close to call. The stakes are high because the ANC's electoral dominance means whoever wins the party's top job is likely to become the next president of South Africa after the next national election. Party spokesman Zizi Kodwa said on Friday that the ANC would aim to announce the new leader and five other top positions during its Dec. 16-20 conference. "On Sunday morning as we arrive we should be able to make an announcement of the top six and take nomination of the rest of the leadership. We need to take out this item from the conference agenda as quickly as possible," he told radio station 702. Political instability, including the question of who will replace Zuma, has been cited by credit rating agencies as a major factor behind their decision to cut South Africa to "junk". Trade has been cautious in the rand and bonds this week, with investors awaiting the outcome of the ANC leadership race. Some analysts say that the bitterness of the contest has increased the chances of the party splitting after the conference. Party officials insist members will accept the outcome and avoid a fallout. The ANC has governed Africa's most industrialised economy since the end of apartheid in 1994 but scandals around its leader have seen its support decline. Disillusioned ANC members have left to form new political groupings on several occasions - the most recent example being the African Democratic Change party founded by former ANC lawmaker Makhosi Khoza this year. As well as electing a new leader, the ANC will choose senior officials such as the secretary general and members of the key National Executive Committee (NEC). The party will also set policy at the meeting, which opens on Saturday in Johannesburg. In the last 18 months, the ANC's executive has been the scene of fierce internal disputes as Zuma's leadership has come under scrutiny, particularly after a cabinet reshuffle in March that saw respected finance minister Pravin Gordhan axed. In August, Zuma narrowly survived another attempt in parliament to force him from office after some members of his party voted with the opposition. Enoch Godongwana, a NEC member who chairs a party committee on economic policy, said there had been interactions between the main opposing party factions to prevent the party splintering. "If the ANC collapses, do you have anything in its place which can hold this country together on a national basis? I would argue that at this stage in time you simply do not have a replacement for the ANC," he told reporters on Thursday. EYES ON 2019 VOTE Ramaphosa is a former trade union leader who became one of South Africa's richest businessmen. He is seen as the most business-friendly candidate, compared with Dlamini-Zuma and the five other contenders. His promises to fight corruption and revitalise the economy have gone down well with foreign investors and ANC members who think Zuma's handling of the economy could cost the party dearly in the 2019 vote. Dlamini-Zuma is associated with a radical brand of wealth redistribution which is popular with poorer ANC voters angry at racial inequality. Ramaphosa edged Dlamini-Zuma by getting the majority of nominations to become leader of the party, but it is far from certain he will become the next party leader and therefore the likely next president. He is expected to be backed by ANC veterans, labour unions and civil society organisations. "If Dlamini-Zuma wins, a split is very likely, because the Ramaphosa camp views itself as the 'old ANC'. This is a last attempt by them to regain control of the party from the Zuma faction," said Darias Jonker, director for Africa at Eurasia Group. Dlamini-Zuma has been backed by President Zuma, as well as by the ANC's influential women's and youth leagues. Political analyst Ralph Mathekga said he thought Dlamini-Zuma would win the leadership, partly because of her strong support in KwaZulu-Natal province, which is sending the most delegates to the conference. (Editing by James Macharia and Andrew Roche)