Mbeki, Zuma fight it out in damaging ANC race

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JOHANNESBURG, Nov 20 (Reuters) The battle to lead the ruling ANC has boiled down to President Thabo Mbeki and his former deputy Jacob Zuma in a clash that has shaken the party to its core and left South Africans uneasy about their future.

There are no signs that an economic boom will end anytime soon but millions of South Africans mired in poverty are waiting for the African National Congress, which led the fight against apartheid, to ease their hardships and tackle rampant crime.

Political analyst Susan Booysen says it is hard to gauge who has the edge in the final stretch of the race. The ANC will meet to elect a new party leader at a conference from December 16-20.

Booysen puts her money on Mbeki, a shrewd party tactician who made his name lobbying against apartheid in exile.

''Don't we wish we had a crystal ball?'' she said.

''If I had a gun at my back and I had to choose, with reluctance, I would choose Mbeki ... Given that he has incredible resources to draw on, it's almost unimaginable to think he can't pull it off.'' The ANC dominates South African politics and the party leader would normally also be the national president. Mbeki, however, cannot serve another term as president, so the ANC will have to find a new formula to choose a national president if he wins re-election as party leader.

Victory in the ANC leadership election would place him in a strong position to choose a successor as president.

Mbeki fired Zuma as deputy president in 2005 after he was implicated in a corruption case, but the charismatic politician has made a strong comeback.

Zuma enjoys wide support from left-leaning unions and has worked his charm on investors who fear he may stray from successful economic policies.

PERSONALITY STRUGGLE JP Morgan bank says financial markets will be hoping for continuity, especially if factionalism tears the ANC apart.

''We think that while markets might initially react negatively to the election of some candidates in December, the current policy stance is likely to be maintained,'' it said in an economic research note.

The rivalry between Mbeki and Zuma has also emerged as a clash of personalities, not clearly spelled-out policies. Mbeki works behind closed doors to win over more supporters, while Zuma fires up crowds.

The fight has widened party divisions and generated talk of a compromise candidate.

Widely respected multi-millionaire businessman Cyril Ramaphosa has the political credentials to be a last-minute spoiler.

He was the ANC's chief negotiator during talks that led to a peaceful end to apartheid in 1994 and Nelson Mandela becoming South Africa's first black president.

Businessman Tokyo Sexwale has been campaigning quietly. The former freedom fighter's support crosses racial and political lines and he enjoys backing from crucial ANC constituencies.

In a surprise move, Foreign Minister Nkosazana Dlamini-Zuma, Zuma's ex-wife, said last week she would not refuse if the ANC asked her to become South Africa's president.

But analysts say these names may not have the appeal of Zuma or Mbeki. And given the acrimony between the two, neither might be willing to back out of the race.

To Mbeki's camp, Zuma's controversial reputation represents a threat to the legacy of Mandela.

Zuma earned respect after spending long years at Robben Island prison, along with Mandela. But he has lost favour in the party over bribery and fraud allegations he is still battling.

He was acquitted in a separate rape trial but his image has been tarnished.

Mbeki has not escaped the spotlight.

Opponents say he has developed an autocratic leadership style that has hurt South Africa's widely hailed democratic ''miracle'' after apartheid. He accuses many of his critics of being racists opposed to black rule.

Reuters ARB DB0918

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