JOHANNESBURG - South Africa's ruling African National Congress claimed victory on Friday in a general election that will make party leader Jacob Zuma president.

With the African National Congress holding 66.28 percent of the vote after more than 90 percent of ballots were counted, it was just short of keeping the two-thirds majority it needs to change the constitution, a scenario of some concern to markets.

The ANC has been given a clear and resounding mandate, senior party official Matthews Phosa told thousands of cheering supporters at a victory party in Johannesburg.

The ANC is going to rule this country for the next five years, said treasurer-general Phosa, a close ally of Zuma, appealing for unity among all South Africans.

Despite the failure of a party of ANC dissidents to make a dramatic impact, the ANC had less than the nearly 70 percent of the vote it won in 2004 and appeared to have lost control of the Western Cape province, center of the tourist industry.

The rand currency firmed over 2 percent against the dollar to a new 6-1/2-month high, aided by a strong euro, higher stocks and following the smooth election.

A reinvigorated opposition had hoped to at least curb the majority to below two-thirds, but for many voters the ANC's credentials from the fight against white minority rule still outweigh its failure to tackle crime, poverty and AIDS.

LOSS OF COPE

The Congress of the People (COPE), formed by politicians who broke from the ruling party, had won less than 7.5 percent.

The ANC's closest rival was the Democratic Alliance (DA) with almost 16.2 percent. The DA, whose leader Helen Zille is white, pulled ahead of the ANC in the Western Cape province, which is currently controlled by the ANC.

The 67-year-old Zuma will become president only three weeks after managing to get prosecutors to drop an eight-year-old corruption case on a technicality. His supporters dismiss the accusations against him as politically motivated.

Some foreign investors fear trade union allies will push him to the left. The continent's biggest economy may already be in recession for the first time in 17 years.

In order to deal with the impact of the recession they will have to be a more effective government than the ANC has been in the past, said Steven Friedman, Director at the Center for the Study of Democracy.

Zuma has repeatedly said there will be no nasty surprises in store for investors and his room for policy maneuver is limited because of the global downturn. Finance Minister Trevor Manuel, a market favorite, is expected to stay for now.

Election officials estimated the turnout at over 76 percent, the same as in 2004. Observers from the 15-nation Southern African Development Community and African Union said on Friday the election was free and fair.

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