New South African President Jacob Zuma delivers his first State of the Nation address on Wednesday, under pressure from a recession and union demands for economic policy changes that could scare off foreign investors.

Given those challenges at a time of global financial woes, Zuma is likely to tell South Africans he might take longer to ease widespread poverty and crime, create jobs and tackle an Aids epidemic ravaging millions.

Union allies who helped Zuma's rise are already growing impatient, pushing for deeper interest rate cuts and nearly blocking one of the biggest share listings in Africa's biggest economy shortly after his May 9 inauguration.

Zuma will probably be at pains to appease labour in his speech, scheduled for 11:00.

He has tried to reassure markets of policy continuity but may have to work much harder at it if unions take tough measures to try to force him to steer the economy to the left.

"I do expect him not only to reach out to the unions (but) almost try and placate the unions," Chris Landsberg, head of the politics department at the University of Johannesburg, said.

HIGHER STAKES

The charismatic Zuma always has managed to get out of tight spots on his path to the presidency, including an eight-year corruption case dropped just before election.

But the stakes are much higher now and he has little room for manoeuvre. Global financial woes have hit demand for South Africa's minerals and manufactured goods, with a knock-on effect on an economy in its first recession in 17 years.

Local newspaper editorials highlighted Zuma's plight.

"Zuma's supporters and sponsors have created an impression that he is the saviour that South Africa has been waiting for," said the Sowetan.

Harsh realities have not held back restless unions.

On Monday, metalworkers threatened mass strikes for bigger interest rate cuts after the African National Congress (ANC) cautioned labour unrest could deepen the recession.

South Africa's mine workers' union backed calls for deeper rate cuts, although it said it would give the central bank time to change monetary policy before considering strikes.

Zuma's balancing act between pleasing unions and investors is likely to get more complicated as he tries to deliver on promises the ANC has been making since coming to power in 1994.

Millions of blacks still live in grim townships, glaring reminders of the inequalities of apartheid. Critics say a black economic empowerment programme has only served a few black millionaires with close ties to the ANC.

Officials hope one of the world's highest rates of violent crime will not discourage soccer fans from attending the 2010 Fifa World Cup hosted by South Africa, which is banking on the event to bring in millions of dollars and international prestige.

"He's (Zuma) talked a lot and partied much. Today more talk, more festivities. Enough. Time for action," said The Citizen newspaper.