SOUTH Africa is currently investigating alleged corruption amounting to over $7bn at several major state-owned enterprises, according to a report released on Tuesday by the Special Investigative Unit (SIU), the country’s national anti-graft body.
These investigations, some of which have been ongoing since 2018, involve six key state-owned businesses: Transnet (ports and rail), Denel (arms manufacturing), Eskom (power utility), the National Lotteries Commission, South African Airways, and the Passenger Rail Agency of South Africa (PRASA). The SIU report, presented to a parliamentary committee, provided an update on the status of these probes.
At Transnet alone, nearly $4bn in public funds are under investigation, linked to around 60 suspicious contracts and numerous cases of conflict of interest and other alleged corrupt activities. The report also highlights nearly 40 additional ongoing investigations into corruption involving various other state-run enterprises and government departments at both national and provincial levels, involving billions of dollars more.
The SIU’s findings underscore the scale of South Africa’s corruption challenges over the past 15 years. Much of this corruption is linked to the administration of former President Jacob Zuma, who led the country for nine years before resigning in 2018 amidst widespread allegations of graft.
A judicial inquiry into high-level corruption during Zuma’s tenure implicated numerous government officials and executives at state-run businesses in accepting bribes and kickbacks in exchange for lucrative government contracts or favours. The culture of corruption reportedly spread across all levels of government, yet few of those implicated have faced criminal charges.
The economic impact of this corruption has been severe, particularly on South Africa’s power utility, Eskom. Mismanagement and corruption at Eskom have contributed to the near-collapse of the country’s electricity supply, leading to record levels of nationwide blackouts last year. The SIU is currently scrutinising more than 270 contracts at Eskom, worth nearly $2.2bn, in an investigation that has been ongoing for six years.
At PRASA, investigators suspect $540 million was lost to corruption, including through a scheme involving payments to over 1,200 ‘ghost employees’ who did not exist. One particularly large contract under investigation, worth more than $300 million, dates back to the 2010 FIFA World Cup hosted by South Africa.
Corruption became synonymous with the African National Congress (ANC) during Zuma’s presidency, a central issue in South Africa’s national elections earlier this year. For the first time since the end of apartheid in 1994, the ANC lost its parliamentary majority.
Current President Cyril Ramaphosa has vowed to clean up the party and government, promising to bring those responsible for corruption to justice. However, anti-corruption experts remain sceptical, noting that it is unlikely much of the stolen money will be recovered.
