EDINBURGH — Over three decades, Zimbabwe declined steadily under Robert Mugabe. Finally, after the despot was deposed in a coup in November, the country may have a bright future. But, much depends on the election of its next ruling party. Observers note that who wins is less important than how this party and leader achieve victory at the voting booths. Zimbabwe has a history of rigged election outcomes. If this month’s ballot is relatively uneventful, international investors are expected to sniff around for opportunities in a country that is rich with resources but has been decimated by corruption. – Jackie Cameron

By Brian Latham and Godfrey Marawanyika

(Bloomberg) – An influx of Western observers is giving Zimbabweans some hope that this month’s elections won’t be a repeat of the tainted contests held during former President Robert Mugabe’s 37-year rule.

While Zimbabwe’s past three elections were marred by allegations of rigging, violence and intimidation, new President Emmerson Mnangagwa has welcomed the return of monitors from Western nations whose governments were more critical of Mugabe than their African counterparts. He’s vowed that the July 30 vote will be free and fair – a key to start rebuilding the southern African nation’s reputation and an economy battered by years of misrule.

“It’s good there are observers from outside Africa this time,” said George Rusere, an unemployed 23-year-old in the northern town of Guruve. “In the past, only African nations or countries friendly with Mugabe were allowed, and they whitewashed election after election to keep their friend in power. Maybe this time it’ll be different.”

Election violence peaked in 2008 when about 200 people were killed. The main opposition Movement for Democratic Change and civil rights groups have routinely accused the ruling Zimbabwe African National Union-Patriotic Front party of using a politically biased police force and military to limit their access to voters in its traditional support base in the rural areas and using force to suppress dissent.

Opposition suspicious

This year the MDC has been able to campaign in rural areas for the first time since its formation in 1999, drawing large crowds to rallies. Yet it remains suspicious about the government’s commitment to a free vote and Western monitors’ ability to guarantee one.

The opposition says the voters’ roll is inaccurate and the printing of ballot papers is mired in secrecy. Voter education remains largely in government hands, and an attempt by legal rights group Veritas to challenge the status quo failed when the High Court refused to hear its suit because it said it was presented improperly.

“We’re still deeply concerned about serious breaches of our electoral laws and the constitution,” the MDC’s leader, Nelson Chamisa, said in an interview in Harare, the capital. “Zanu-PF, the Zimbabwe Electoral Commission or the international community can’t just dismiss a patently unfair process.”

The European Union, along with Norway, Switzerland and Canada, is deploying about 140 observers, and the Washington-based International Republican Institute and the National Democratic Institute are sending a joint team of more than 30 monitors.

The African Union is dispatching 54 observers, while the Commonwealth, an association of mainly former British colonies, and the Southern African Development Community, a regional group, are expected to send their own teams.

Observers’ impact

“Observers will have a two-pronged impact,” Nhlanhla Ngwenya, an analyst at 4Cast Research said by phone from Bulawayo, the second-largest city. “Firstly, they act as a deterrent to political violence just by being in the country in greater numbers. Secondly, they serve to help give the election legitimacy if they find it credible, free and fair.”

The presidential election is largely a straight fight between Chamisa, 40, and Mnangagwa, a 75-year-old former vice president and spy chief who replaced Mugabe after he resigned in November when the military briefly seized power and his party threatened to impeach him. None of the 21 other candidates have a realistic chance of winning.

The run-up to the vote has been largely peaceful. The most serious incident occurred when an explosion went off at a ruling party rally in Bulawayo on June 23 and 49 people were hurt, two of whom later died. Mnangagwa, who narrowly escaped injury, suggested that his opponents in the ruling party and not the opposition were responsible for the attack.

“At least there’s no violence this time,” said Nyarai Moyo, 44, a teacher from the northern town of Magunje. “Observers from outside help, especially Americans and Europeans, because the police and Zanu youth will most probably keep themselves to themselves if foreigners are around.

Unrealistic expectation

The electoral commission and ruling party both say all the necessary steps have been taken to ensure a legitimate vote.

“We expect the political environment ahead of the vote to be the freest in decades, but totally free and fair is an unrealistic expectation,” Gary van Staden, an analyst at Paarl, South Africa-based NKC African Economics, said in an emailed report. “Who wins the elections is less important than how.”

Terence Jakaya, 32, an unemployed resident of Harare, said the election’s credibility can only be determined after the results are in.

“It’s good that Western observers were allowed in this time and credit to Mnangagwa for opening the door,” Jakaya said. “Still, I don’t know how effective they can be with things like the voters’ roll and ballot papers, so even with them, there’s a chance of rigging.”

JOHANNESBURG — The name Tony Hayward will ring a bell for many who remember the BP Deepwater Horizon oil spill. The oil spill, which occurred in April 2010 in the Gulf of Mexico, was the biggest of its kind in history. Hayward resigned several months thereafter. After moving on from that scandal, Hayward is now the chairman of Glencore, and he’s going to now form part of a board committee that will respond to a US probe into alleged corruption at the world’s biggest commodity trader. Glencore is already in hot water with the US Department of Justice (DoJ), and the presence of Hayward will either help it navigate the mess it’s in or shine a further probing spotlight on the company. – Gareth van Zyl

By Thomas Biesheuvel

(Bloomberg) — Glencore Plc has set up a board committee to respond to a U.S probe into possible corruption at the world’s biggest commodity trader.

The committee is formed of chairman and former BP Plc Chief Executive Officer Tony Hayward, as well as non-executive directors Patrice Merrin and Leonhard Fischer, Baar, Switzerland-based Glencore said in a statement Wednesday.

Glencore last week said the Department of Justice demanded documents relating to possible corruption and money laundering regarding its business in Nigeria, the Democratic Republic of Congo and Venezuela over the past decade. The news marked the latest twist in a tumultuous year for the company, knocking about $5 billion off its market value in just a day.

On July 5, Glencore moved to soothe investor concerns by saying it’ll buy back as much as $1 billion of its shares this year.

“Glencore takes ethics and compliance seriously throughout the group,” Hayward said in the statement. “The company will cooperate with the DOJ, while continuing to focus on our business and seeking to maximize the value we create for our diverse stakeholders in a responsible and transparent manner.”

JOHANNESBURG — We tend to forget in South Africa that corruption and financial mismanagement is a global phenomenon. Case in point is the Oando scandal, which cuts borders but is rooted in Nigeria. What we should all be thankful for these days is the greater information flows regarding these scandals. Nothing better than sunlight to put the focus on individuals and businesses. – Gareth van Zyl

By Emele Onu

(Bloomberg) – A London court ordered two companies owned by Wale Tinubu, the chief executive officer of Nigerian energy company Oando Plc, and his deputy, Mofe Boyo, to pay $680 million to Ansbury Investment Inc. following a dispute over shareholding and financial management.

The London Court of International Arbitration ruled that Ocean and Oil Development Partners, a company incorporated in the British Virgin Islands, which owns 55.96 percent of Oando through a holding company, is indebted to Ansbury to the tune of $600 million, Ansbury spokesman Bolaji Akinola said.

Whitmore Asset Management Limited, also owned by Tinubu and Boyo, owed Ansbury $80 million, Akinola said in a statement emailed Monday.

The dispute, which arose in 2017, is related to the investment in 2012 by Ansbury of $700 million to acquire a 61.9 percent stake in Ocean and Oil Development Partners, a special-purpose vehicle in which Whitmore held the remaining 38.1 percent, according to the statement.

SEC petition

Ansbury, owned by the family of Nigerian-Italian businessman Gabriele Volpi, petitioned Nigeria’s Securities and Exchange Commission in 2017 over allegations of financial mismanagement, indebtedness and falsification of financial statements, Akinola said. The SEC in October ordered a probe into Oando and suspended the stock after a review of the company found possible insider dealings and discrepancies in its shareholding structure.

While the Abuja-based SEC lifted the trading ban on Oando in April, it continued with the investigation into the company.

Oando shares slumped 9.4 percent to 5.80 naira at the close in Lagos Monday, the biggest drop in a year.

Tinubu didn’t respond to an email seeking comment. Oando itself isn’t in any way indebted to Ansbury Investments and wasn’t party to the arbitration, the company said in a statement.

EDINBURGH — It’s been a tough time in the headlines for Dan Matjila, the boss of South Africa’s state asset manager, the Public Investment Corporation (PIC). Matjila has been accused of using his influence to push financial support in the direction of a love interest. But, he has denied the allegations as has the woman – who also denies having a romantic relationship with Matjila. For Matjila, the smear campaign is the work of corrupt individuals who have been trying to get their hands on state support and failed. Nhlanhla Nene, the finance minister who was fired by Jacob Zuma because he was seen to be in the way of looting state assets, has given Matjila his full backing. Nene, who was reinstated by new president Cyril Ramaphosa, has refused to suspend Matjila as a political party has requested. – Jackie Cameron

By Ana Monteiro

(Bloomberg) – South Africa’s finance minister is opposing a political party’s demand to immediately suspend the head of the country’s biggest money manager because the department is already probing allegations of governance breaches there.

The United Democratic Movement on June 15 asked a court to direct Finance Minister Nhlanhla Nene to suspend Public Investment Corp. Chief Executive Officer Dan Matjila, bar the PIC’s board from taking decisions on removing or disciplining the CEO, and instead make this the minister’s responsibility. The UDM’s request follows accusations that Matjila used PIC funds to support the business of a woman with whom he was romantically involved, claims the CEO has denied.

The “invitation to the court to usurp the minister’s powers” isn’t congruent with the constitution because “the facts do not call for such a drastic remedy and doing so would be a breach of the principle of separation of powers,” Nene said in an affidavit dated July 2. He has engaged “multiple stakeholders” on the governance issues at the PIC, including the allegations against the CEO, Nene said.

The PIC, which manages state workers’ pension funds, handles more than R1.9 trillion ($144 billion) of assets. The UDM holds four of the 400 seats in the National Assembly.

CAPE TOWN — This story that gets you wondering whether the ANC’s Zuptoid vs Reformist division and malaise can be sufficiently resolved to enable the ruling party to address the bread and butter issues in time to avoid a jobless army backing an EFF general to lead it into revolution. Put crudely, that’s the equation some of the top analysts quoted below are putting forward for debate. The facts, outlined so starkly, support the view that the honeymoon period of Ramaphosa’s new incumbency is well and truly over, while the global economic context is set to aggravate things. Yes, President Ramaphosa has secured Middle Eastern investment promises of R233 billion, a Usain Bolt-like launch out of the starting blocks of his five-year trillion rand investment race. But his pre-election talk of a spirit of renewal and confidence in forging unity within the party and going into the elections as a united force ring somewhat hollow, given the Zuma-led traditionalist, disgruntled Zuptoid undercurrents swirling around. How to walk this political tightrope, with Zuptoids in his cabinet and leading the party and country, while promoting critical economic reform that doesn’t feed his opponents cause, will be his greatest test. – Chris Bateman

By Sam Mkokeli

(Bloomberg) – Economic and political problems are piling up for Cyril Ramaphosa, dampening the euphoria that accompanied his ascension to the South African presidency.

A labor union boss turned business tycoon, Ramaphosa took office in February after the ruling African National Congress forced Jacob Zuma to resign following a scandal-tainted tenure that lasted almost nine years. While Ramaphosa initially won plaudits from investors and the public for instigating a crackdown on graft, sentiment has soured as record-high fuel prices, inflation-busting pay increases for government workers and demands for bailouts by broke state companies stymie his efforts to turn around the flagging economy.

The rand, which surged more than 10 percent against the dollar between the time that Ramaphosa secured control of the ANC in December and his election as president, has surrendered almost all its gains, while foreigners have ditched a net R35.3 billion ($2.7 billion) worth of the nation’s bonds this year. The threat of a global trade war and a shift in sentiment against emerging markets has added to the gloom, and business confidence slumped for five straight months after reaching a two-year high in January.

Media hype

“‘Ramaphoria’ was not there in the first place – it was just a media and business construct,” said Xolani Dube, an analyst at the Xubera Institute for Research and Development in the eastern city of Durban. “We are still grappling with serious economic issues in South Africa that Ramaphosa cannot solve on his own.”

The difficulty of the president’s task has been compounded by internal battles in the ANC, which remains deeply divided after a bruising leadership fight that he won by the narrowest of margins.

That’s forced him to tip-toe around party barons who opposed his candidacy and his bid to restore the image of the party that Nelson Mandela led to power in 1994. It’s also limited his ability to bring about policy changes needed to meet his goal of attracting $100 billion in new investment over the next five years.

There has been some good news. Consumers remain upbeat, with First National Bank Ltd. and the Bureau for Economic Research’s confidence index holding close to a record high in the second quarter.

Ramaphosa’s investment drive has also met with some success — he secured a commitment from Saudi Arabian and United Arab Emirates companies to put as much as $20 billion into projects in South Africa during an official visit to the region this month. Mercedes-Benz AG announced last month it will invest 600 million euros ($700 million) in expanding its plant in the coastal city of East London.

The president remains bullish about his ability to unify the 106-year-old party, which has governed South Africa since white-minority rule ended. While it secured 62 percent support in the last national election four years ago, that slumped to 54.5 percent in a municipal vote two years ago.

“Our mission is to have a united ANC,” Ramaphosa said in an interview broadcast on July 16 on Johannesburg-based eNCA. “We’re busy holding conferences around the country, and those are being underpinned by spirit of renewal. I am confident – confident underlined – that the ANC is going to forge unity and we’ll go into the elections as a united force.”

‘Fundamental reform’

Mmusi Maimane, who leads the Democratic Alliance, the main opposition party, said Ramaphosa had missed an opportunity to assert greater control over the ANC and convince it to adopt more investor-friendly policies.

“This economy is not going to do with tinkering; it needs fundamental reform,” Maimane said by phone.

Ramaphosa’s grip on power will depend on him improving living standards and the public education system, addressing rampant crime and creating jobs for the 27 percent of the workforce that is unemployed, said Ralph Mathekga, an independent political analyst and author of a new book: “Ramaphosa’s Turn, Can Cyril Save South Africa?”

“It is bread-and-butter issues that often start revolutions,” he said. “If the government cannot respond to the pressing economic issues, and deal with safety concerns, then Ramaphosa is risking a revolution.”

CAPE TOWN — You just have to compare the length of tenure and track records of President Ramaphosa and President Mnangagwa’s predecessors to get the picture. In fact, try comparing the foreign investment achievements (actual or promised) of the current incumbents in the short time they’ve been in power and you’ll quickly see why whoever wins in Zimbabwe after Monday’s freest-yet election will get very little sleep. Unlike Ramaphosa, Mnangagwa’s not seen several hundred billion rand of investments promised (by two Middle Eastern countries and China). This article explores how much more Mnangagwa or his successor (it’s shaping up to be a right contest) will have to do to make up for the 21 years of misrule, corruption and neglect that the obstinate ideologue Bob Mugabe directed and oversaw. We’ve had a decade of Zuma-led State Capture and civic neglect in South Africa – but it doesn’t come close to the economic clawback a Zimbabwean president will need. Winning Monday’s election will be a hollow victory indeed. – Chris Bateman

By Brian Latham, Godfrey Marawanyika and Desmond Kumbuka

(Bloomberg) – The winner of Zimbabwe’s July 30 elections could find their victory to be a hollow one.

The next ruler will have to administer an economy in meltdown after two decades of misrule and corruption under former leader Robert Mugabe and a broke Treasury that’s unable to service its loans or take out new ones. That will leave little scope to improve government services, rebuild crumbling transport links and meet a plethora of other election pledges.

Both President Emmerson Mnangagwa’s ruling Zimbabwe African National Union-Patriotic Front and the main opposition alliance, led by Nelson Chamisa’s Movement for Democratic Change, are targeting increased foreign investment as they seek to grow the economy and create jobs. They haven’t spelled out how they plan to fund incentives to build mines and factories, or provide the infrastructure those businesses will need.

“We’ve heard lots of talk about being open for business, but nothing tangible to attract business,” said John Robertson, an independent economist based in the capital, Harare. “As things stand, it’s cheaper to import products than manufacture them locally because of the very high production costs.”

Urban decay

The difficulty of operating in Zimbabwe is starkly evident in Harare, a sprawling, run-down city of about 4 million people. Some areas haven’t had running water for years, raw sewage leaks from burst pipes that go unfixed for weeks at a time and long stretches of tarmac roads have been reduced to rutted tracks. The city council estimates it needs $10 billion to repair infrastructure and attend to its maintenance backlog.

Most other towns and rural areas in the southern African nation have fallen into even worse disrepair and government services are sparse or non-existent.

Zimbabwe’s slide dates back to 1997, when its troops became embroiled in a war in the Democratic Republic of Congo that depleted the national coffers. Its predicament worsened in 2000, when the seizure of white-owned farms by government-backed militants slashed agricultural output and tax revenue. The government then forced the central bank to print money to pay its workers, sparking hyperinflation that eventually forced it to abandon the Zimbabwean dollar in 2009 and begin using mainly the U.S. dollar.

Currency woes

While the switch helped stabilize the financial system until late 2015, an appreciating American currency left Zimbabwean manufacturers unable to compete with their regional rivals, resulting in surging imports and a slump in exports. Dollar bills began to dry up, banks limited withdrawals and the state and companies were left struggling to pay their workers on time.

The government introduced bond notes, a dollar-backed quasi-currency, to ease the liquidity crisis, but the effect has been marginal. Today more than 98 percent of transactions are conducted via bank and other transfers and dollar bills are worth as much as 80 percent more that their electronic equivalent. The cash premium, which is fueling inflation, has mainly been driven by manufacturers who need to maintain stock levels and continue importing to maintain production.

Government wages

“The biggest challenge will be the currency issue — whether to introduce a local currency or continue with the multi-currency arrangement and what to do with bond notes,” Welcome Mavingire, managing partner at Intellego Investment Consultants, said by phone from Harare. “They’re a symptom of the bigger problem of lack of confidence and the shortages of foreign currency. Whoever wins, once they address those issues, I think everything else will begin to fall into place.”

Zimbabwe’s problems go far deeper than a problematic currency regime. The government has about 350,000 employees whose wages gobble up almost the entire national budget and it owns about 100 companies, most of which are cash-strapped and dysfunctional. The country is also saddled with $1.7 billion of arrears owed to the African Development Bank and World Bank that it needs to clear before it can tap new loans from multilateral lenders.

While the shuttering of metal refineries and manufacturing plants have brought an end to daily power outages, supply is still constrained and the country remains dependent on imports from neighboring Mozambique and South Africa to supplement output from its Kariba hydropower plant and ailing Hwange thermal plant.

The ruling party is targeting an annual economic growth rate of at least 6 percent over the next five years, attracting $5 billion in foreign direct investment and $10 billion in domestic investment a year. The MDC-led alliance says if it’s elected it will build a $100 billion economy (gross domestic product was $17.5 billion last year, according to the International Monetary Fund), sell or close some state companies and introduce a flat corporate tax rate.

Both parties have pledged to revive mining, agriculture and manufacturing, ensure there is macro-economic stability and fiscal discipline, bring debt under control and modernize the government.

A relatively free, fair and credible election that reflects the will of the people is a necessary condition for Zimbabwe to move forward, Gary van Staden, an analyst at NKC African Economics in South Africa, said in an emailed note.

“Thereafter the real problems need to be addressed,” he said. “The economy is a mess, the regulatory environment is a nightmare and there is no foreign currency to assist investment when it knocks on the door.”

CAPE TOWN — There’s a line between satire and reality that good writers purposely tread – and South African politicians and their acolytes provide such a fantastic reality that portraying their exploits is constant grist to the mill of any talented artist. Veteran journalist Ed Herbst has lived and worked at the heart of the South African beast and watches its current manifestations with gleeful fascination as his literary musings rack up detractors and admirers in equal measure. This piece, littered as usual with hyperlinks that provide a masterclass for any new student of South African society and politics, would beggar belief were it not accurately based on events. These are actual people whose reported behaviour is verifiable, if not certifiable. There’s obviously some truth to the metaphor that excreta rise to the top. – Chris Bateman

By Ed Herbst*

But at the time, Mashaba said that the man – who was among four men arrested during a raid in Dobsonville two weeks ago – was only “believed” to be employed at the ANC’s Luthuli House headquarters.

It was a comment that sparked rumours and speculation, the nation desperate to find out the name of the ANC man who was allegedly personally involved in at-gunpoint heists. – Penwell Dlamini The Times 19/7/2018

On June 19 The Times revealed that the Hawks, energised by Ramaphoria, had arrested Eric Velile Present, one of the rising stars at Loot-freely-and-fully-House. Present was alleged to be member of one of the gangs who star in the Anneliese Burgess book, Heist! South Africa’s cash-in-transit epidemic uncovered.

None of the hacks covering the story bothered to ask Jesse Duarte – the authority on the ANC’s ‘moral compass’ – for comment, probably because they knew what her answer would be anyhow: “He is innocent until proved guilty!” leaving the rest unsaid – the rest being “He is part of The Collective and you can’t imprison The Collective because our jails are overfull anyway.”

The TimesLive article revealed that Present was a promising intern in the Luthuli House ‘Roar, Young Lions Roar!’ Academy established thanks to a generous Brett Kebble donation a decade ago:

That post came just seven months after a February 2017 article in the Sunday Times which linked him to a controversial farm deal in Limpopo.

The Sunday Times reported that then Rural Development and Land Reform Minister Gugile Nkwinti introduced this Luthuli House comrade to one of his top officials at a land summit when Present was “shopping” for a thriving Limpopo farm.

Just eight months after the meeting‚ Bekendvlei Farm was bought for R97-million and handed over to Present – who had been working at Luthuli House for more than 10 years – and his partner‚ businessman Moses Boshomane‚ to manage.

A senior departmental official had prioritised the deal by bypassing required procedures. A day after the deal went through‚ Nkwinti was the speaker at Present’s lavish wedding.

Neither Present nor Boshomane had an ancestral claim to the farm. They also had no agricultural experience‚ the newspaper reported.

Formidable CV

According to City Press, Present had a formidable CV which would have ensured a rapid rise through ANC ranks had he not blotted his copybook by being arrested for the umpteenth time. Among his recent achievements are:

Robbery-in-transit in July this year;

Intimidation in February this year;

Possession of an unlicensed firearm in November last year;

Armed robbery in June last year;

Malicious damage to property in February last year;

Murder in November 2016;

Reckless and negligent driving in May 2015; and

Attempted murder in July 2013.

Graduates of the Academy can point to the benefits of their training, the significant potential of their successes being preserved for posterity and a real chance of jumping the queue for a customised Scipio Griffin.

Aspirant snouters, hoping to be admitted to the academy will be encouraged by the brazen looting at the VBS Mutual Bank, proof positive that the ANC’s ‘Spirit of Snouting/Pride in Peculation’ initiative is bearing lush and low-hanging fruit.

Loot-freely House is confident, though, that the ANC has the necessary strength in depth and this is confirmed by the appointment to higher office of Qedani Mahlangu and Brian Hlongwa and Mike Mabuyakhulu. Having already provided proof of their undoubted potential, it can surely be only a matter of time before they represent ‘our people’ in parliament and take our acclaimed and distinguished vanguard movement into an ever-brighter future.

These are, however, troubling times for the stalwarts among us who stoutly defend the glorious National Democratic Revolution. Take the redoubtable Edna Molewa for instance.

First she took on Raymond Suttner and now she is threatening to take parliament to court over its move to hold the board members of one of her entities personally liable for financial decisions deemed to constitute fruitless and irregular expenditure.

Counter-revolutionary

The idea of holding anyone to account is counter-revolutionary and threatens the very foundations of our illustrious movement – next thing and before you know it, they will be cashiering those who cashed in at Eskom and racked up almost R20 billion in irregular expenditure.

What is the world coming to if a dutiful parent like Matshela Koko or worthy servants of the movement like Brian (Sam Browne) Molefe and Anoj (Sticky Fingers) Singh  and Ben (Mining Scam) Ngubane cannot sleep peacefully at night?

And where, in the name of all that is good and gracious, will this all end, I ask?

Will they revisit the 5000% profit that Chancellor House made on the Hitachi tender organised by Comrade Valli (Squeaky Clean) Moosa which set the benighted and beleaguered Medupi project back by months and many millions?

Will they revisit the Land Bank scam which saw Helena Dolny persecuted until she left and, thereafter, the first looting tranche of hundreds of millions of rands going to Pamodzi Investment Holdings which had Manne Dipico and Kgalema Motlanthe among its shareholders?

Will they revisit the Big Bay 1 and 2 scandal which saw Tokyo Sexwale getting the tender with a bid that was R37 million less than the highest offer after the then mayor,  the suitably-rewarded Nomaindia Mfeketo, justified  this ‘discount’ by saying that they were no longer prepared to ‘accept crumbs from the white man’s table’?

Will they start intruding in the private lives of brave heroines of the movement like Matilda Gaboo and Lorraine Masipa?

One hopes not – the Seriti Commission, did, after all, prove conclusively that corruption is completely alien to the African National Congress ethos.

Thirsting for more knowledge I decided to risk the labyrinthine process of contacting my Browse Moles, my fossorial contacts of satirical mien who live in the Luthuli House catacombs and who fear exposure because that would find them floating lifeless and face-down under a lotus leaf in a leafy suburb swimming pool not too-distant from the Saxonwold Shebeen.

Somewhat downcast the BM acknowledged that morale at Luthuli House had taken a hit.

“Present is a good lad for whom we had high hopes but we had to cut him loose because Herman Mashaba was shouting the odds.”

The Browse Mole went on to say that Present was showing real snouting promise when his burgeoning career was so tragically cut short, adding that he was a shining example of the ANC’s ‘due diligence process’.

Noting my quizzical look he added, “He showed that he was made of the right stuff and deserved promotion – you know, like Pumlani Mkolo. The Luthuli House mandarins believed that Present was, in fact, MP material  – like Senzeni Zokwana and Rubben Mohlaloga  and Matthew Wolmarans and Brian Molefe and Enoch Godongwana and Baleka Mbete and Thandi Modise and Tina Joemat-Pettersson and Bongani Bongo and, of course, Jacob Zuma. ”

Mother of all books

I was though, something of an emissary on behalf of Cape Town’s small media community and I had another question to ask – this time on behalf on the Mother City Hack Pack who are bewildered, bereft and seeking answers.

It concerned MOAB – The Mother of All Books.

When Terry Bell let one of the world’s greatest philanthropists and shining business icons know that his claim – among others – that he had treated Nelson Mandela ‘on and off the island’ did not stand up to even the most cursory analytical scrutiny, the great man – whose photograph appears almost daily in his own newspapers – was not fazed.

“To let you into a little secret, I have been busy with my autobiography over the last few months and you will appreciate that I do not want to spill all the beans and keep some facts out of the public domain to ensure the success of my autobiography.

“My biography will provide much insight with detail including documents and photographs and personal stories told by many of the people that I was privileged to positively impact on their lives.”

That was two years ago and nothing had been heard until … until … the rumour spread like wildfire that MOAB, the Mother of All Books, was going to be launched amidst much joyful fanfare at Davos.

Davos, of course, is of course where the great and the good – everyone from Carlos Slim to Jeff Bizos – gather on their annual pilgrimage to hear Dr Survé lay the good word upon the adoring multitude and to watch him react with his usual compassion to the hordes of beseeching supplicants.

Davos, however, came and went and there was only a dreadful void of dispiriting silence.

“Tell me about MOAB”, I begged.

Spitting her cornflakes

“Well”, he said. “I can’t reveal too much other than to say the advances are going to have J K Rowling spitting her cornflakes across the breakfast table in rage and consternation.”

“What about the film rights?” I wanted to know.

“It’s all a bit fluid at the moment,” the Browse Mole said. “Miramax was thought to be in with a chance until Harvey Weinstein saw his arse with the ‘Me To’ movement. That left David Lynch, Quentin Tarantino, Thomas Anderson and Hayao Miyazaki duking it out and the lawyers are salivating. But that’s the least of it.”

“Why?” I asked.

“I’m talking Netflix versus Amazon, dude, and I’m talking billions. This is going to take off like a Sagarmatha Intergalactic Highway African Unicorn turbocharged with LeisureNet nitromethane!” the Browse Mole said.

He lent forward conspiratorially. “I can let you into a little secret – MOAB contains an entire chapter on the Robben Island swims!”

I am sworn to secrecy but I can reveal that not only does this chapter testify to the extraordinary bravery and tenacity which the Great Man – he told an SABC interviewer at 4 minutes 27 seconds of this YouTube clip: that his adoring staff justifiably call him the ‘Fearless Leader’ and the ‘Teflon Doctor’ – displayed even as a teenager. It also solves a mystery which bewildered marine scientists in the early 1980s – the ‘Brown Tide”.

I can also tell you – because it is common knowledge by now – that the moment MOAB is published, Dr Iqbal Survé will be inducted,into the Chuck Norris Hall of Fame.

As the Great Man triumphantly tells it, he was an impecunious youth who, to survive, used to sell the Cape Times and the Cape Argus at traffic lights – and now, to the consternation of his enemies, he owns both newspapers!

At this time, a Good Samaritan gave him a bike – and thus glorious history was made which will be forever celebrated in the annals of the Beloved Country. Furthermore, so I am informed, his scintillating career is shortly to be recognised with a suitable award, the Order of the Baobab with Brass Knuckledusters.

This bike enabled our intrepid schoolboy hero to treat Nelson Mandela ‘on the island’.

Whenever the call came, he always answered and he would hurriedly assemble his emergency first aid pack.

This included all the cutting-edge medicines of the time, Carter’s Little Liver Pills, Grandpa Headache Powders, Eno’s Fruit Salt, Borstol Cough Syrup, Buchu Brandy, Vicks Vapo Rub, TCP antiseptic and Brooklax – septuagenarians like myself vividly recall the latter for one of its stellar advertising campaigns – ‘Is the bottom falling out of your world? Take Brooklax and the world will fall out of your bottom!’

He would park his bike against the Mouille Point lighthouse and attach a wooden clothes peg to his nose to help him get past the Green Point sewage outfall. Then, with his medical supplies strapped to his chest inside a black bin bag, he would set off for Robben Island – swimming backstroke, obviously.

It was on the return journey that, unencumbered and swimming crawl, he set times which would have blown the mind of Michael Phelps – had these mercy  missions not taken place under conditions of extreme secrecy.

It was at these times that marine scientists were baffled by the sudden dearth of Great Whites in False Bay accompanied by conditions of extreme turbidity – what they, in their mystification at the time, called the ‘Brown Tide’.

MOAB reveals that these sensitive creatures, always alert to extreme danger, would, at the time of these mercy swims and at the very minute that our intrepid schoolboy entered the water, head south leaving behind, in their fear, a dense cloud of faecal matter.

I struggled to get my head around this extraordinary information but I had more questions to ask.

“Will Patricia de Little, notorious for her antipathy to anti-retrovirals, canvas for the ANC in next year’s elections?”

“You’re pushing your luck – but you could be onto something there”, the Browse Mole growled.

It was time to leave.

Until next time…

• Ed Herbst is a retired veteran journalist who writes in his own capacity.

JOHANNESBURG — Investigative sleuth Paul O’Sullivan is not letting up in demanding accountability from consultancy firm McKinsey. A mea culpa from McKinsey’s boss Kevin Sneader earlier this month increasingly appears to be hollow especially following a City Press report over the weekend that revealed how the consultancy firm’s fleecing of Eskom and Transnet was much bigger than previously thought. (Transnet is said to have paid McKinsey a total of just over R3.1bn over the years according to a draft report from National Treasury.) The City Press report further details how McKinsey sent Anoj Singh – former Transnet and Eskom CFO – on lavish junkets after sealing lucrative state deals. O’Sullivan again inks a letter to McKinsey Africa’s boss Saf Yeboah. Take a read… – Gareth van Zyl

By Paul O’Sullivan*

Dear Saf,

On 09th July 2018 in front of an audience of hundreds, McKinsey’s new Global Managing Partner, Kevin Sneader tried to demonstrate that McKinsey had come clean and also that they had found no wrongdoing on the part of their staff. He was merciless in the manner he dealt with some of the questions, that sought to accuse McKinsey of wrongdoing.

Ironically, on that date you had already replied to questions from treasury, requesting you to explain the ‘gratification’ you had piled onto Anoj Singh, whilst he was in the process of opening doors for you at Transnet and later at Eskom.

Your response to Treasury was nothing more than an admission of guilt, that you had indeed BRIBED Anoj Singh, with lavish trips overseas, in terms of today’s article in City Press:

https://www.news24.com/SouthAfrica/News/treasury-drops-looting-bomb-20180729-4

I have attached Act 12 of 2004, and commend you to read the definition for ‘Gratification’. It states, amongst other things: (g) any other service or favour or advantage of any description, …..Overseas trips are definitely INCLUDED in this description.

Surely you must know, that there is a big difference to convening a meeting at your own office and putting on coffee and a few snacks than flying someone twice on 20,000 km round trips and putting them up at luxury hotels. At last check, The Langham in London averages about ZAR10,000 per night, including breakfast. At a guess, I estimate you have spent between ZAR300k and ZAR400k on such ‘gratification’ of Singh.

This leaves me (and the rest of South Africa and the world) a few questions:

1.       When you told us on 01 May 2018 and again on 09 July 2018, that you could find no wrongdoing by your staff, who was looking? And had they been trained by your stablemates, Hogan Lovells?
2.       Why did you deliberately omit to tell us all that you had bribed Anoj Singh with lavish overseas trips?
3.       Who else did you bribe in South Africa, in order to ‘win’ so much business from state owned companies?
4.       Why did you NOT come clean yet, as you have been repeatedly required to do, preferring instead to act like a kind of double agent, fighting off the authorities on the one hand, whilst telling a public meeting that you could find no wrongdoing on the part of your people?
5.       Will you prepared to publish the full cost of the expenses you incurred for the trips for Mr Singh, including hotels, travel, S & T’s visa costs and so on, or are you planning to continue being opaque?
6.       Did Singh’s wife or any other person accompany him on these trips?
7.       Are you saying that for your global CFO’s conference you BRIBE each and every CFO of each and every company / government agency you ‘consult’ for? If the answer is yes, then it means your global business is founded on corrupt practices, and needs to be shut down immediately. In any event, I am meeting with the Serious Fraud Office in London the week after next, and I shall be taking your wholesale bribery in breach of Section 6 of the Bribery Act up with them. A copy of the UK’s Bribery Act 2010 is attached and I commend Section 6 to you:

8.  From the above it is clear that in return for the lavish trips you covered for Anoj Singh, he not only opened doors for you, he closed doors for Nedbank, of which I am a shareholder. He did this so that he could push cash the way of his Zuptoid friends through Regiments and Trillian, a sleight of hand that your firm was well aware of. Do you therefore agree that you are not only liable for the ill-gotten gains received by McKinsey, but are also liable for the monies stolen by Regiments and Trillian, which means you should have paid back R3.1bn?

Whether you agree or not, I and many fellow South Africans are now calling on you to PAY BACK THE MONEY. Not some of it, ALL of it.

As I said to you at our meeting at your office building Sandton on 01 May 2018, (the building you share with another beneficiary of South African public funds – Hogan Lovells) if you want to step over a line in the sand and prove that you will become part of the solution, instead of remaining part of the problem, you MUST COME CLEAN.

You haven’t come clean, quite the opposite, you have continued to conceal your role in bribery and corruption. That concealment amounts to a criminal offence.

Unless you come clean now, and stop playing this double game you are playing, I will take steps against you for publishing the fraudulent report stating that you could find no wrongdoing on the part of your staff. Whomever prepared that document for Kevin Sneader, could be charged for acting with a common purpose of deception. I imagine the global partner of McKinsey would not like to be a fraud suspect, so I am giving you some time to re-think your arrogant attitudes and your visible disdain for the public of this country. You have until my meeting with the UK’s SFO the week after next. If I do not hear from you, I will shut-down communications with you and do what has to be done. I will give no ground.

I shall be in London at the end of next week and welcome the chance to meet with Kevin in person, to see if McKinsey can be persuaded to do the morally right thing, or face the music for your fraudulent cover-up.

In the meantime, I am taking steps to arrange to have your London office picketed by loyal South Africans abroad who are gatvol of seeing their country being bled dry by companies like McKinsey, Hogan Lovells, SAP, ENS Africa and KPMG. You won’t be the only UK office to be picketed, we are going for your stablemates as well. Jermyn Street and High Holborn are within an easy journey of each other.

Unlike a good bottle of Claret, these type of things do NOT get better the longer you leave them on the shelf. The dwindling spiral of Bell Pottinger, KPMG, SAP, Hogan Lovells is very self-destructive. You surely must know that if you do the right thing, there may be a future for McKinsey on this planet, but if you do the wrong thing, as you have been doing, the end is nigh.

It was the unlawful protection of the corrupt clients of McKinsey’s that led to the corrupt clients of Hogan Lovells, to drag me and my two small children off a London bound plane two and a half years ago, incarcerate and torture me, and charge me on trumped up charges, to stop me from exposing the corruption of all of you. If McKinsey’s had not paved the way for the Zuptoids to enrich themselves, and Hogan Lovells had not of kept criminals running the DPCI/Hawks, then I would not have been arrested for exposing the Zuptoids. You and Hogan Lovells, like ENSAfrica, all had a role in my arrest and torture, whether unwittingly or not. We Irish, we have a long memory.

Mckinsey, Hogan Lovells and ENSAfrica are top of my list of corrupt firms to deal with. I’m sure you can understand why.

On behalf of all South Africans, OUR RIGHTS ARE RESERVED!

Best wishes

Paul

EDINBURGH — London law firm Hogan Lovells has been accused of helping Zupta capture state assets. South Africa-born Peter Hain, a former Labour cabinet minister and veteran anti-apartheid campaigner, told the House of Lords earlier this year that he had reported Hogan Lovells to the UK’s Solicitors Regulation Authority, accusing it of producing a “fatally flawed whitewash” report into claims of money laundering at the South African Revenue Service. Hogan Lovells dismissed Hain’s allegations as “unfounded accusations”. As The Guardian told its readers in January, Hain’s claims against Hogan Lovells relate to the firm’s investigation into allegations of corruption against SARS deputy commissioner Jonas Makwakwa, who, along with his lover, was alleged to have siphoned off about R1.7m (£100,000). Makwakwa denied any wrongdoing. Makwakwa and SARS commissioner Tom Moyane were accused of the “dirty work of robbing taxpayers”. Hain called on the SRA to withdraw Hogan Lovells from the solicitors trade body and consider withdrawing its partners’ permission to practise as solicitors. But the SRA has washed its hands of the matter, claiming that the South African branch of the law firm is merely using the London branch’s name for branding purposes. It looks like the London legal hotshots have wriggled out of being punished for complicity in industrial scale corruption that brought South Africa to its knees – on a technicality. – Jackie Cameron

Peter Hain‘s response:

Thank you for examining the material I sent through in different tranches asking for Hogan Lovells to be suspended and its Senior Partners barred from practising in the UK.

However you will be unsurprised to learn that I am extremely disappointed with the outcome.

Hogan Lovells UK have managed through a procedural body-swerve to avoid culpability because, according to the SRA, it ‘does not control’ Hogan Lovells SA and is linked only as ‘essentially a branding exercise’.  This seems to me plain legal sophistry which brings an international law firm like Hogan Lovells into even greater disrepute, adding to their terrible reputation for whitewashing corruption and money laundering in the South African Revenue Service.

It seems to me that the SRA is simply standing by and allowing Hogan Lovells to slip through your investigative loopholes which does legal regulation in the UK no credit at all.

I will be pursuing this matter of lax UK solicitor regulation when Parliament resumes in the Autumn.

Paul O’Sullivan‘s response:

Further to your attached communication to Lord Hain. I consider same to be an official ‘endorsement’ of low ethics in the legal fraternity which the Solicitors Regulation Authority is supposed to ‘regulate’.

Forensics for Justice is a South African charity that focusses on exposing and holding people accountable for corruption in South Africa.

For your information it was clients of Hogan Lovells (with the knowledge of Hogan Lovells) that had me kidnapped and tortured, for no other reason than to prevent me from exposing the corruption that we call State Capture, which nearly brought this country to its knees, but made millions in fees for Hogan Lovells. I therefore have an interest in the matter and can confirm that we have previously assisted Lord Hain, by providing him with information of wrong doing by Hogan Lovells ‘brand’ (as you call it) in South Africa. Hogan Lovells banked millions of Rand of tax-payer funds for their role in State Capture, which included keeping criminals in their jobs to commit further serious crimes.

I wish to enquire about the following: https://www.sra.org.uk/solicitors/handbook/overseasrules/content.page

May I be so bold as to ask if you have considered these rules in your response to me, since the South African arm of Hogan Lovells appear to be trading off what you describe as a ‘branding exercise’?

If you have considered same, perhaps you can explain why the above rules don’t apply in this instance?

Does it mean that a UK law firm can act in another country with impunity, by using a ‘branding’ set up?

Did you ask the question whether any ‘benefit’ is derived in the hands of the London of Hogan Lovells for the use of their brand in South Africa?

If Hogan Lovells outside of South Africa, received any benefit for the crimes of Hogan Lovells inside South Africa, then surely that would make them accountable?

I am sorry to trouble you with this so late, but would seek clarity, in view of the fact that I will be requesting Lord Hain to continue to apply public pressure on both Hogan Lovells and, now, the Solicitors Regulation Authority.

I do recall pointing out to the SRA two years ago how another well-known London law firm was complicit in cash transfers of in excess of USD500,000 which were used to bribe then corrupt ministers in Liberia, by a London based mining company. Curiously, although the owner of law firm in Liberia to whom the well-known London law firm sent the funds, were indicted, along with the corrupt ministers, the SRA chose to let them off the hook.

I must say, I am left to believe that the SRA are not using their rules to hold reticent lawyers accountable and as such, do the public a disservice.

A group of discontent South Africans in London will shortly be embarking on a campaign to expose the low ethics of UK based firms Hogan Lovells and McKinsey. They are forced to this action, in the case of Hogan Lovells, as a result of the complete failure of the UK’s Solicitors Regulation Authority to bring them to book.

I therefore request you to reopen your enquiry and hold these people accountable for their conduct and to pay back the fees they earned.

Hogan Lovells response:

The Solicitors Regulation Authority (SRA) has confirmed that it does not intend to take any regulatory action against Hogan Lovells International LLP in relation to a complaint made by Lord Peter Hain in January of this year.

The peer has made a series of statements against the firm in the House of Lords in January this year which claimed that Hogan Lovells in South Africa had been complicit in supporting corruption in that country through its work for the South African Revenue Service (SARS).

We have consistently rejected the allegations made by Lord Hain as simply being demonstrably untrue and was reported in detail in BizNews on 23 January in our report ‘Sunlight over shadow’. You can read a copy of the SARS report for yourselves in what was published by the South African parliament and our op-ed in BizNews goes in to the full details and context, and was published in May.

This and always has been a piece of work carried out in South Africa for a South African client by South African qualified lawyers and we are pleased that the SRA, with whom we have fully co-operated, agrees with this.

The appropriate forum for resolving any dispute is and always has been in South Africa with the Law Society of the Northern Provinces. We proactively brought this matter to their attention when Lord Hain raised his complaint and we are working closely with them. In addition, the chair of our practice in South Africa has twice given evidence to the South African parliament and fully accounted for the work that we undertook.

We understand the need for transparency and we are very happy for our work to be scrutinised by the appropriate and authorities. We remain committed to supporting investment in South Africa at this time and to continuing to contribute locally to our capacity building and pro bono programmes in collaboration with other key stakeholders.

CAPE TOWN — If simplicity and veracity are measures of credibility, then DA leader Mmusi Maimane must surely emerge smelling of roses. That’s not hard when the ruling party’s record and convoluted explanations for its behaviour turn the national garden into quagmire of almost impenetrable weed and thorns. Here he highlights the value of accountability in the body politic before graphically illustrating the complete lack of it in the ANC with example after example. All verifiable. The catch line for me is this; if us voters don’t hold parties to account for their actions or inaction, we must assume part responsibility for the outcomes. Ongoing blatant party reward for, or at the very least turning a blind eye to, ongoing corruption, cadre deployment and inefficiency is the pervasive ANC norm. Maimane is challenging voters, prodding their consciences about ongoing ANC support and loss of integrity during and beyond the past decade. The clear message is; beyond State Capture, how much more suffering will you endure before you say at the hustings; “enough is enough, let someone else do the job?” – Chris Bateman

By Mmusi Maimane*

Accountability is like baking powder. If you’ve got it in the mix, the cake is bound to rise. If you haven’t, that cake is staying down no matter how great the other ingredients.

In South Africa, we can have impunity, or we can have progress. We cannot have both. All living systems act on feedback, human beings included. If you steal from your country and get reappointed or promoted, you keep stealing from your country. If you do a bad job and get away with it, you keep doing a bad job.

It’s really that simple.

South Africa needs to build a culture of political accountability, meaning that if there is corruption in a department, or if the department performs poorly, the political principal, the minister, is held to account. Currently, the litmus test is if corruption can actually be pinned on the principal, through a lifestyle audit. This is not enough. That is why outrageous crimes such as Marikana and Esidimeni can be committed against South Africans, and not a single politician is held to account.

The Gauteng ANC Provincial Executive Committee’s message to Qedani Mahlangu and Brian Hlongwa is: it’s ok to kill people and steal from the public. Mahlangu was MEC for Health when 144 mentally ill patients died from neglect. Hlongwa was implicated by the Special Investigating Unit in corruption amounting to R1.2 billion, receiving kickbacks from companies contracted by the provincial health department during his tenure as MEC. Both were re-elected to the PEC this weekend.

Failure to hold wrongdoing to account shifts the blame to those whose responsibility it is to demand accountability. Gauteng Premier David Makhura recognized this when he promised: “There will be justice. I made a commitment to the affected families, that I will walk all the way with them to ensure that justice is served.” If Makhura’s PEC don’t hold Mahlangu and Hlongwa to account, then it falls to voters to hold the Gauteng ANC to account.

Accountability is the essential raising agent that will see South Africa rise out of its current slump. The ANC has time and again failed to hold its public representatives to account for gross misconduct. It claims to uphold women’s rights, yet retained Mduduzi Manana as Deputy Minister of Higher Education after he was convicted for assaulting three women. To add insult to injury, Bathabile Dlamini, was rewarded for the SASSA debacle by being appointed Minister of Women.

The ANC recently appointed convicted fraudster, Tony Yengeni, to chair its committee on crime and corruption. Arthur Fraser, was redeployed to head up Correctional Services having been justifiably accused of treason. In his January cabinet shuffle, President Ramaphosa appointed Bheki Cele as Minister of Police. Cele was dismissed as national police chief in 2012 on allegations of corruption involving inflated leases. Malusi Gigaba was made Minister of Home Affairs, having played an instrumental role in enabling state capture as Minister of Public Enterprises.

The ANC removed Zuma to save themselves ahead of the 2019 election, not to hold him accountable for grand corruption and state capture. They never told him or South Africa what he had done wrong. The official who allowed the Gupta plane to land at Waterkloof base was rewarded with an ambassador’s post.

In every instance, the message is clear: it’s ok to behave like this. And when voters keep voting for the ANC, they send leaders the same message: it’s ok to behave like this.

Even bureaucrats are not held accountable. The ANC’s policy of deploying its branch members into the bureaucracy and as accounting officers means there’s a cosy relationship between politicians and bureaucrats in which no one is ever held to account.

Accountability is not just about fighting corruption and gross misconduct. It is also an essential performance management tool. The standard to remove someone from their job cannot be ANC-level corruption. If a public servant is failing to serve the public with distinction, that must be reason enough to consider giving someone else the opportunity to do a better job.

Angie Motshekga was reappointed as Minister of Education, even as SA continues to rank lowest of the low for reading and maths. Aaron Motsoaledi has overseen the disintegration of our health services and is in no danger of losing his job as a result.

Our public education system is a crime against our children. Our public health system is an insult to the sick. We cannot afford to ignore or reward poor performance. If we want different outcomes, we have to do politics differently in this country. If we change our politics, we can change our nation.

The thing we South Africans need to grasp is: if voters don’t hold parties to account for their actions or inactions, we must assume part responsibility for the outcomes. In a democracy, accountability ultimately rests on the shoulders of the electorate.

The DA will continue to pursue accountability in the De Lille matter. Accountability is a core DA value. No-one can be above the rule of law. No individual’s interests can be above the collective interests of the residents of Cape Town.

This week, Zimbabweans go to the polls. This is a game-changing opportunity for them: a chance to rid themselves of a liberation movement party atrophied by corruption and patronage; a chance to usher in a new era of accountability; a chance for the people of Zimbabwe to reclaim their power and their freedom. It appears to be a close race and we can’t be sure what the outcome will be. But we can be sure that when accountability is a guiding principle, South Africa and Zimbabwe will rise.

• Mmusi Maimane, leader, Democratic Alliance. 

CAPE TOWN — When the IMF predicts South Africa’s budget deficit for this and next year at 0.6 percent higher than our own National Treasury estimate (i.e. IMF reckons 2.9% and 3.3%), then the task begins to look a bit like trying to turn a leaking super-tanker around. Not that President Cyril Ramaphosa’s crack investment drive team hasn’t secured hundreds of billions of rand in Middle Eastern and Chinese promises. It’s just that the SA super tanker is leaking almost as much through its debt-laden and dismally-managed state-owned companies. With international fiscal waters changing from glassy calm to stormy in a mere week or two, a State ship newly up to its gunnels with fresh cargo yet leaking will take a very long time to turn around. It might be that all President Ramaphosa and his highly capable team can do is stop it from sinking. That metaphor also relates to business confidence slipping every month since a two-year-high in January this year. Domestic growth, not foreign investment is the key. Racking up debt to foreign countries with ambitions of global economic domination cannot serve us, long-term. – Chris Bateman

By Ana Monteiro

(Bloomberg) – South African authorities should deepen the fight against corruption and change its labour and product markets as some of the nation’s post-apartheid achievements have “recently unwound” amid slow economic growth, the International Monetary Fund said.

IMF directors recommended “the forceful application of the Public Financial Management Act to increase deterrence against corruption,” the Washington-based lender said in a statement Monday. They called for the completion of pro-investment, job-creating measures in the telecommunications and mining industries, and said more progress is needed to contain fiscal risks from debt-laden state-owned companies.

IMF officials issued the statement after so-called Article IV consultations with local authorities.

Africa’s most-industrialised economy hasn’t grown at more than 2 percent since 2013. Bailouts for troubled state companies such as Eskom Holdings SOC Ltd. and South African Airways have raised risks that the National Treasury will breach its spending limits. Probes by the anti-graft ombudsman indicated that billions of rand was looted from state companies by businessmen and officials with close ties to former President Jacob Zuma. They all deny wrongdoing.

“The country has potential but the key challenge is to raise growth,” Montfort Mlachila, the lender’s senior resident representative in the country, said by phone. “Without increasing growth, you’re really just shuffling the chairs on the deck – you need to expand the size of the pie.”

Per-capita economic growth has turned negative, the jobless rate is near a 15-year high of 26.7 percent, and income inequality is among the highest globally, the IMF said. Business confidence has slipped every month since reaching a more than two-year high in January as industries await real reforms under the tenure of new President Cyril Ramaphosa.

Fiscal risks

“Significant vulnerabilities arise from fiscal risks related to weak and poorly managed state-owned enterprises,” the IMF said. The state’s guarantees of Eskom’s outstanding securities total about 7 percent of gross domestic product, Treasury data show.

The lender maintained its forecast for economic growth this year at 1.5 percent and left the 2019 estimate at 1.7 percent.

The current-account deficit will probably expand to 2.9 percent of GDP this year and 3.3 percent in 2019, it said. In its February budget, the National Treasury forecast a gap of 2.3 percent for this year and 2.7 percent in the following 12 months. The deficit was 2.5 percent of GDP in 2017.

“External risks include large gross external financing needs, and a current-account deficit financed by flows that are prone to sudden reversals in response to abrupt changes in global financial conditions and sovereign credit ratings,” the IMF said.

The government is committed to reducing the deficit and stabilizing debt, the National Treasury said in an emailed statement after the release of the report.

CAPE TOWN — We live in a country where the failure to meet the constitutionally required provision of basic needs has become almost systemic, right now mainly due to intra-ANC factionalism. The populace daily grows ever more hostile and cynical with protests about identical service delivery issues spread across the country. Dangerous conditions that need urgent addressing, says political analyst, academic and apartheid-era detainee, Professor Raymond Suttner, who firmly believes President Ramaphosa can fire the Zuptoids in his cabinet without his much-feared destabilisation of government. Reminding us that South Africa is still the most unequal society on earth, he says widespread citizen hostility and cynicism are born of dashed hopes that the post-liberation government would remedy or substantially mitigate the legacy of apartheid – at least after 24 years. Yet incompetence or lack of capacity and/or will with unspent budgets, corruption or State Capture, are endemic. Somehow, Ramaphosa must provide tangible hope for his potentially alienated voters who remain in large measure an oppressed people. Shedding over 120,000 jobs in the second financial quarter is not the way to do it. The article was first published on polity.org.za. – Chris Bateman

By Raymond Suttner*

There is a range of developments happening simultaneously at the moment that throw a disquieting light on any democratic and potentially broader emancipatory project in South Africa. Some of these do not receive much attention in media coverage or political discourse.

There is a sense amongst very many people that their lives have not improved significantly since 1994 or that some qualities of dignified, safe and reasonably comfortable existence have been denied them. I used to argue, in the early years, that things had utterly changed in some rural areas which had previously had no access to water, other than in often polluted rivers, and electricity or where people had previously had to travel long distances to the nearest white town in order to telephone someone. They would previously see the telephone and electricity wires above their townships going from one white town to the next. (Guest Essay: A Conversation with Raymond Suttner: Reflecting on a Decade of Freedom in South Africa, The Australasian Review of African Studies, 27:1, June 2004, 8-17.)

Some of these changes had implications beyond the increased access to basic needs, improved physical health and well being. Access to water in taps, freed women and girl children from fetching water from rivers and in some cases, patriarchs destroyed the water pipes. They did this because women, while standing around the taps, discussed political matters and in the early years of democracy some were elected-for the first time – to office in councils and other structures.

In some cases, those gains have remained or been extended but, in many, there have been setbacks especially in the maintenance of clean water, electricity supply, access to healthcare, land and shelter. With the now extensive use of mobile phones, the performance of Telkom has been a less significant factor than it was 24 years ago.

In some cases, new threats to realising these rights have emerged or resources to carry out the obligations have been squandered or have not been used or there has been insufficient or inadequate human capacity or in one or other way what momentum there was in the early years has not been sustained.

The failure to meet the constitutionally required provision of basic needs has become almost systemic, in that many people have been waiting for two decades and plans have been developed but never implemented or as we have seen with school infrastructure, responsibility has been evaded for one or other reason over a very long time. (See Faranaaz Veriava on a recent court victory, while relating the stratagems indulged in by the Department of Basic Education, to avoid meeting basic rights.)

In response, we now see protest action on any given day, often on the same issue, in places thousands of kilometres apart. Usually, there is no organisational connection between protesters in one place and those in another. There is little sustained organisation in most of these protests. They are not bound together by a common programme or ways of understanding.

Under apartheid people protested or engaged in insurrection in order to create a society and state where their rights would be respected. In present-day South Africa they protest, often for some length of time because they are not enjoying rights, which authorities are obliged to provide because that is what the constitution demands. Just as the ANC and its allies denied that the liberation struggle was for civil rights, which implies that these are rights that citizens are entitled to access, now people are demanding what are in fact civil rights, in the changed post-1994 constitution.

Studies show that inequality between rich (mainly white) and poor (mainly black, referring to Africans, coloureds and Indians – especially Africans and women) has widened and we are the most unequal society on earth. What was supposed to be remedied or substantially mitigated has been left unattended or partially addressed and then left unfinished after 24 years.

In the early years there may have been situations where there was a case of “chasing numbers” in providing some basic needs, without training local people for maintenance. Thus, where water pipes are blocked, very often those who can repair these are located many kilometres away and what could be repaired locally, requires skills that put the resource out of reach for an unnecessary period.

In some situations, failure to meet obligations has been due to incompetence or lack of capacity or lack of will where budgets have not been spent. In some cases, this has been a result of corruption or State Capture. Whatever the reasons may be there are very many people who do not see post-apartheid South Africa as having provided significant changes in their living conditions. They also appear, increasingly, to have lost confidence in the present state having the will to remedy these situations or correct the setbacks. 

While the inauguration of representative democracy in 1994 generated an upsurge of hope, many have grown cynical or hostile and do not cherish expectations of improvements in their lives in the now, not so new South Africa. Protests and especially violent protests are a sign that people do not have confidence in the available processes in order to secure state action to improve their lives. They do not see or are not told of procedures that ought to unfold and can be relied on to open up remedies that will be realised. There is a sense that there are substantial blockages preventing improvement in their basic living conditions and they consequently, relatively frequently, take things into their own hands, albeit often without a plan beyond manifesting frustration through wreaking destruction, or what media call “mayhem” or going “on the rampage”.

It is well known that Cyril Ramaphosa was elected ANC president with a small majority last December and much of what he has done or not done, appears to be resulting from the need to maintain his support base. Despite this qualified support, there has been commendable, albeit uneven work towards regularisation of state practices, notably in cleaning up State owned enterprises and re-instilling respect for the Rule of Law.

There can be no question that the Treasury must be defended, and irregular expenditure brought to a halt, whether in terms of corruption or the wider attack on state sovereignty referred to as State Capture, where powers of the state were illegally ceded to others who were able to make a fortune out of state resources.

On the one hand, Ramaphosa was and is vulnerable but on the other he needed to put a stop to the pillage. While we, as citizens of South Africa must be cognisant of these constraints it is undesirable that the needs of citizens should be held to ransom by intra-ANC factionalism that needs to be managed in order to maintain Ramaphosa as ANC and also State President.

Even if some cabinet appointments were an attempt to show even-handedness by including those who had supported the candidacy of his ANC presidential opponent Nkosazana Dlamini-Zuma, what is the value of appointing people who have demonstrated no capacity to do work, honestly and competently? This is especially important where they hold portfolios which address socially vital issues.

Some of these appointments are people who have shown themselves to be unable or unwilling to perform their tasks and in some cases ones who are alleged to have been involved in or overseen departments involved in large-scale corruption or State Capture. Their retention in high office implies continuity, a case of “Zumaism without Zuma”. Their presence is at a time when the signal that needs to be sent if there is any “new dawn”, is that of rupture with what went before and dispatching of some people to the “outer darkness”.

If Ramaphosa is to assert his leadership, he needs to act and stare down the potential threat that the removal of these ministers might constitute. In truth, most or all of these have no real constituency that they bring in support of this new government. Their removal would not destabilise the government more than their presence means that people are holding portfolios where they are not performing often vital tasks.

It is important to compromise or show adequate respect to a range of stakeholders. But if the ANC has a policy of redressing land hunger, how does the president justify his excessive deference to King Goodwill Zwelithini and other traditional leaders, in various statements from the earliest days of his election as ANC president? The traditional leaders have a place under the Constitution. But they are not hereditary rulers, governing parallel to or sometimes in place of the democratic state, but subject to its Constitution.

The king and the managing of the Ingonyama trust has been contrary to the constitution and to the detriment of erstwhile small land owners.. How can the president of the country rush down to the king to assure him that his powers under the Ingonyama trust are sacrosanct, when many legal opinions argue that the act is unconstitutional and that practices conducted in the name of the act are illegally usurping rights of those living in the area? (Abuses are found in other parts of South Africa, especially mineral rich areas, where Traditional Leaders sometimes make deals with mining companies over land which belongs to the community.)

The entire episode where President Ramaphosa left all his duties in order to reassure the king about the Trust was disquieting, not simply because it was inappropriate and ill-judged but also in his reaction to the photo of him kneeling. He responded that that was an old photograph where he was showing the king his book displaying his high-quality cattle.

The President needs to be advised to be more self-reflective on such questions, and to consider how others see what to him is a harmless gesture. How does the president think a displaced former small landowner or one paying exorbitant rent will react to a picture of the president and the king exchanging notes on their respective conspicuous consumption? Is this display of his cattle wealth to the king demonstrating sufficient sensitivity to the ANC’s claimed constituency of the poorest of the poor?

Ramaphosa does not seem to be focused on the range of issues that are explosive in the country at the moment. A few weeks ago, he said that “in two weeks” there would be a significant change in the situation where people found themselves under great pressure from price hikes. How could he make such an undertaking? Unsurprisingly, the period has passed without significant results. There are periodic instructions to ministers to attend to this or that and report speedily on how it will be remedied. The power of these instructions has now diminished in the public eye, with the exception of the important steps taken to clean up the state and state-owned enterprises. Even here, we know that the damage done by State Capture will take long to repair and few have, thus far, been held accountable. (See Natasha Marrian article.)

The president, the government and the ANC need to focus on investment and raising resources to meet a range of commitments. But there needs to be a balance. One gets the impression that there is little compassion towards the poor, those who are causing “mayhem” on highways because their shacks are being torn down. Why are they still in shacks? Why are these torn down? What is the plan to remedy their situation and that of many others facing situations of poverty -including de facto 40% or more joblessness, and extensive homelessness? There are few recreational facilities for the high number of youths who are unemployed, and this is a fertile ground for the already high levels of crime.

The Zuma project was an attack on the state’s capacity, ensuring that the Guptas and their allies had inside knowledge and power over appointments and decisions. It was thus also an essentially anti-democratic project. In a sense, State Capture was a form of treason, usurping the powers of the democratic state in order to achieve undemocratic goals.

The response to Zumaism cannot be purely at the technocratic level in cleaning up, important as that is. There needs to be a democratic vision, where those who are currently protesting, throwing rocks and destroying a range of other things-have a sense of hope. (It is disquieting to see a KZN MEC feeding into this disillusionment and despair by suggesting that protests be banned and see the response of Right to Know.

“The term Hope”, writes Ana Cecilia Dinerstein, “designates a desire for change and a belief in a situation that is better than the existing one”. She refers to the work of Ernst Bloch, which she says portrays hope as the most genuine feature of what makes us human. “Hope is not fantasy, faith, optimism, or wish, but rather the strongest of all human emotions…. In this view, hope possesses a utopian function, which enables us to engage with the ‘not yet’ dimension of reality that inhabits the present and can be anticipated here and now. Hope in this sense is wilful rather than wishful: it informs people’s concrete endeavours to forge a better life.” (“Hope” in Keywords for radicals, edited Kelly Fitch, Clare O’Connor and AK Thompson, AK Press, 2016 pp 199,201.)

People will recover their hope for a better life if the president and his government demonstrate that they are concerned about the poor, through a vision, which includes a series of steps to remedy the problems that ought to have been addressed over the last 24 years.

Whether Ramaphosa and the ANC can stay the course in realising these goals remains to be seen. The ANC may still win the elections in 2019, but it needs to evoke some sense of enthusiasm, among its support base and the public at large. But it may well be that this is a task that cannot be left to the ANC or the ANC alone. It also seems that no opposition party is advancing a vision that excites the imagination of the population at large, who remain in large measure an oppressed people. That type of organisation, despite the urgency, needs to be patiently built. Its task is nothing less than reconstructing the democratic order in South Africa. DM

• Raymond Suttner is a scholar and political analyst. He is a visiting professor and strategic advisor to the Dean of the Faculty of Humanities, University of Johannesburg and emeritus professor at Unisa. He served lengthy periods in prison and house arrest for underground and public anti-apartheid activities. His prison memoir Inside Apartheid’s prison was reissued with a new introduction in 2017. He blogs at raymondsuttner.com and his Twitter handle is @raymondsuttner

CAPE TOWN — The Zuptoids deep concern with boosting South Africa’s manufacturing and transport sectors by vastly improving our nation-wide rail capacity was worth spending half-a-billion extra rand on. That’s of course if you have a predilection for being wined and dined by the Chinese and then being tipped by them for sharing your splendid company. Zuptoids apparently prefer Chinese to Japanese food anyway, even if they have to pay an obscene amount more for it. In fact, rumour has it that a chain of Chinese restaurants was planned for the Republic of Zuptoid-Afrika. In their compassion and caring for the ordinary man in the street (whose inter-provincial transport was now assured), they could let them eat Chinese, if of course, they played along and helped build the Zuptoid empire, thus being able to afford the bill. Seriously though, what Transnet genius thought they could insanely inflate a supply contract and then give it to the highest bidder, without drawing attention to themselves? One can only speculate one grown so arrogant by State Capture that they genuinely believed they had no chance of being caught. Also, just think of all the hard labour saved by not making the locomotives locally. – Chris Bateman

By John Bowker and Sam Mkokeli

(Bloomberg) – Transnet SOC Ltd., South Africa’s state-owned rail and ports operator, paid R509 million ($38 million) more for 100 locomotives after switching a supply contract to a Chinese rail company from Mitsui & Co. of Japan, according to a report commissioned by the National Treasury.

The finding is part of an investigation into so-called state capture, in which private individuals used influence over government officials to win contracts from state companies. At the center of these allegations is the Gupta family, who were friends with former President Jacob Zuma. They deny wrongdoing.

Transnet’s decision to buy locomotives from China South Rail also resulted in the vehicles being imported rather than made in South Africa, according to the draft report compiled by Fundudzi Forensic Services, seen by Bloomberg. Regarding the increased cost of the contract, Transnet board members – then led by Brian Molefe – must give reasons why they shouldn’t be held accountable, the investigators said.

Transnet’s media office didn’t immediately respond to an email seeking comment and calls went unanswered.

President Cyril Ramaphosa has pledged to stamp out corruption since taking over from Zuma in February. That has included replacing directors at a number of state companies including utility Eskom Holdings SOC Ltd., which has also been embroiled in allegations of misuse of funds and incorrect awarding of contracts.

Proper procedure

In June, a probe by law firm Mncedisi Ndlovu & Sedumedi Attorneys found that Transnet didn’t follow proper bidding and evaluation procedures for contracts, and some executives were “negligent” or took “unlawful decisions.” Top officials should be liable for the resulting losses, according to the report.

Details of the draft document were earlier reported by Business Day newspaper.

Transnet appointed a group led by US consultancy McKinsey & Co. to advise on a further contract to acquire 1,064 locomotives, according to the report. The fee was increased to R267 million from R35.2 million after various “scope extensions,” though there’s no evidence of proposals to justify the increase, it said, adding that an investigation was still in progress.

McKinsey last month reached a settlement to repay almost R1 billion to Eskom and apologised for wrongdoing regarding how it did business with the utility. A McKinsey spokeswoman didn’t immediately respond to an email seeking comment.

CAPE TOWN — If our law enforcement and prosecuting authorities showed one third of the application and drive exhibited by forensic crusader for justice, Paul O’Sullivan, we’d have a very different society. The problem is that the Zuptoid/State-Captured middle order and many high-ranking officers are still in place, their claws and beaks somewhat clipped by President Ramaphosa’s crackdown on corruption, but nevertheless omnipresent. O’Sullivan knows this and has teamed up with the formidable former top State prosecutor Gerrie Nel and AfriForum to bring them to book. If the incumbents, constitutionally obliged to uphold the rule-of-law, were doing their jobs, they’d fumigate their own houses and not leave it to outside civic-minded citizens. The legacy of political obedience is all-pervasive and the ANC reformist faction is seemingly not keen to risk a backlash. Perhaps we could say law enforcement and prosecution has moved from brazenly carrying out the political agenda of the Zuma-regime to withdrawing some of the more outrageous charges (including against O’Sullivan) and reluctantly turning on a few of their own. You could argue that it’s a barometer of President Ramaphosa’s real influence. Setting former Finance Minister Pravin Gordhan and a few straight cops on Zuptoid criminals is perhaps all our new president is able to do. Story courtesy of the Daily Maverick. – Chris Bateman

By Greg Nicolson*

Forensic investigator Paul O’Sullivan is on a mission to clean up the justice system after the National Prosecuting Authority (NPA) dropped charges of fraud and extortion against him in the Palm Ridge Magistrates Court on Wednesday. It brings an end to a string of criminal charges levelled against him, where he was found not guilty or the charges were withdrawn.

Speaking through Forensics for Justice, on Thursday O’Sullivan called on President Cyril Ramaphosa to root out dodgy operators from the justice system, which he accused of conspiring to lay trumped-up charges to intimidate opponents of former President Jacob Zuma’s administration and allies.

“It will take many years for the country to recover from the disease of state-sponsored looting and corruption that very nearly brought our country to its knees,” said O’Sullivan.

“The repair process cannot begin until the rule of law is returned. It is no point appointing a new head (of the Directorate for Priority Crime Investigation) when he is surrounded by hyenas, who daily seek to undermine his attempts to rid this country of the scourge of corruption.”

O’Sullivan’s first targets are from the NPA’s Priority Crime Investigation Litigation Unit (PCLU) and SAPS’s Directorate for Priority Crime Investigation Unit (DPCI), known as the Hawks.

Representing O’Sullivan, law firm Hurter Spies outlined his plans in a letter to PCLU Deputy Director Advocate Jabulani Mlotshwa on Thursday.

They said the unit was “working hand-in-glove with rogue members of the DPCI, as the ‘unit of choice’ to deal with politically motivated false allegations, against not only our client, but against the likes of Anwar Dramat, Robert McBride, Shadrack Sibiya, Johan Booysen, Glynnis Breytenbach, Julius Malema, Pravin Gordhan and the so-called ‘SARS Three’”.

“Multiple fake cases have been run against me, all of which have now failed,” said O’Sullivan.

In 2016, O’Sullivan was dragged off a plane by police and apprehended in front of his young daughters on a unique charge related to his multiple passports. He said his office had been unlawfully raided and he and his lawyer had been kidnapped.

He linked the multiple cases brought against him to charges he laid against high-ranking officials, including former acting SAPS commissioner Khomotso Phahlane, former Hawks boss Berning Ntlemeza, top NPA officials Nomgcobo Jiba and Lawrence Mrwebi, former SAA chair Dudu Myeni, and the former president’s relations Edward and Khulubuse Zuma.

O’Sullivan’s lawyers said the allegations against them included corruption, fraud and racketeering involving amounts over R10 billion, but not one case was opened. At the same time he accuses the NPA and Hawks of subjecting him to intimidation and harassment.

The forensic investigator now wants to get nolle prosequi certificates so he can lead private prosecutions against Mlotshwa and Warrant Officer Kobus Vlok, whom he accuses of working together to invent charges against him. He alleges they should be charged with unlawful arrest, perjury, defeating the ends of justice, torture and theft of a criminal docket.

O’Sullivan has been working in tandem with AfriForum, which in 2016 announced its intention to lead a number of private prosecutions.

“I know the full details of each and every one of the criminals responsible for this gross abuse of power and constitutional rights and will not rest until each and every one of them has been brought to justice,” he said.

“We shall give the state a further 30 days to institute proceedings against those we have identified and, if they refuse to do so, we shall start the process ourselves,” he said of the officials who he claims wronged him.

He also plans to issue a “substantial damages claim”, including constitutional damages, for his treatment by the authorities. He wants Mlotshwa, Vlok and others within the NPA and Hawks to be held personally liable for the costs.

Hawks spokesperson Brigadier Hangwani Mulaudzi said on Thursday that O’Sullivan is welcome to engage Hawks leader Godfrey Lebeya about his allegations, like any other citizen, but the unit cannot act until he details his claims.

NPA spokesperson Hurbetin Phindi Louw-Mjonondwane confirmed that the NPA dropped the Palm Ridge Magistrate’s Court matter against O’Sullivan, but she would not comment on the reasons why. She would not respond to O’Sullivan’s allegations that the various charges were aimed at harassing and intimidating him.

O’Sullivan recently made headlines after it was revealed he was paid R1.2 million by Vodacom in an out-of-court settlement after the company gave his personal information to the legal team of jailed former crime boss Radovan Krejcir in 2014. Krejcir had threatened O’Sullivan, who relentlessly investigated the criminal kingpin.

Recently he has targeted management consultants McKinsey and law firm Hogan Lovells, calling on them to reveal more information about their alleged role in Zuma-era corruption and be held accountable. DM

• Greg Nicolson left his hometown of Melbourne to move to Johannesburg, beset by fears Australia was going to the dogs. With a camera and a Mac in his bag, he ventures out to cover power and politics, the lives of those included and those excluded. He can be found at the tavern, searching for a good story or drowning a bad one.