By Nellie Peyton
JOHANNESBURG, Nov 8 (Reuters) - South Africa's African National Congress (ANC) was dealt a stinging blow in last week's municipal elections, near-complete results showed on Sunday, weakening its hand in the coalition talks that will follow to form city governments.
With 99% of votes counted, the ANC had 31% against 25% for its main rival, the Democratic Alliance (DA). Former President Jacob Zuma's party uMkhonto weSizwe had about 10% of votes, putting it in third place, while the rest was split between hundreds of smaller parties.
Final results are expected to be announced at 6 p.m. (1600 GMT).
The outcome marks a painful setback for the ANC, which has seen its vote share fall steadily in local elections over the last 15 years due largely to failures in basic services such as water and electricity.
Since no party won more than 50% of votes in many cities including South Africa's commercial hub Johannesburg, the ANC and DA will have to team up, or hash it out with smaller parties to form majority municipal governments.
COALITION TALKS TO START SOON
ANC Secretary-General Fikile Mbalula called the result "catastrophic" for the ANC but said the party would not go begging for positions when coalition talks begin soon.
"When the people tell us we have fallen short... the honest answer is not to argue with them but to go home and put our house in order," Mbalula said on Saturday.
Parties will have 14 days to negotiate before city councils are formed.
In Johannesburg, the pro-business DA led the count with about 35% of votes, compared to 20% for the ANC.
That could give DA veteran Helen Zille, who had campaigned on fixing potholes and leaking water pipes, a good chance of becoming mayor, depending on the coalition agreements reached.
The DA said in a statement that it would initiate coalition discussions with "political parties that share a commitment to clean and accountable government, rooting out corruption, service delivery for all, the rule of law, and non-racialism".
(Reporting by Nellie Peyton;Editing by Helen Popper)
