Tough test for ANC as South Africa votes

By Rebecca Harrison

JOHANNESBURG (Reuters) - South Africans vote in a national election on Wednesday with the ruling African National Congress (ANC) facing its toughest test since it vanquished apartheid 15 years ago.

The ANC is virtually ensured of its fourth straight win since defeating white minority rule under Nelson Mandela in 1994, and is expected to make its leader Jacob Zuma president of Africa's biggest economy after the ballot of 23 million people.

But it faces an unprecedented challenge from opposition parties hoping to capitalise on voter frustration over corruption, poverty and rampant crime, and could lose the two-thirds majority that gives it the right to shape laws.

Many analysts believe the ANC, whose anti-apartheid credentials make it the default choice for millions of black voters, will win between 60 and 66 percent of the vote, a result that would cheer investors keen to see the ANC's grip on power loosened.

"Should the ANC win another two-thirds majority, a knee-jerk negative reaction by the markets cannot be ruled out," Razia Khan, regional head of research, Africa, at Standard Chartered, said.

The election will attract scrutiny from foreign investors and local businesses, some of whom worry that Zuma -- who has strong links with the left of the party -- may veer away from policies credited with driving years of economic growth.

Zuma, who had corruption charges against him dropped on a technicality this month, has assured markets there will be no big policy swings but has played up the party's pro-poor roots and pledged to tackle poverty and create jobs.

Zuma's room for manoeuvre, however, is likely to be limited by the impact of global financial crisis in South Africa, which may already be in recession, and by the need to maintain foreign investment to fund a substantial current account deficit.