CAPE TOWN, South Africa (AP) — South Africa is currently investigating alleged corruption worth more than $7 billion at some of the country’s largest state-owned companies, according to a report published Tuesday by the country’s anti-corruption unit.
The investigations are not new. Some have been ongoing since 2018. They were all cited by the Special Investigations Unit (SIU) in a report to a parliamentary committee seeking an update on the status of the investigations.
The investigations involve six state-owned companies: ports and rail operator Transnet, arms company Denel, energy company Eskom, the National Lotteries Commission, national airline South African Airways and passenger rail operator PRASA. According to the report, Transnet alone is under investigation for about 60 suspicious contracts and hundreds of cases of conflicts of interest and other alleged corruption, worth almost $4 billion in public money.
In addition, there are nearly 40 other ongoing investigations into alleged corruption involving various state-owned enterprises and national and provincial government departments, worth billions of dollars more. More investigations have been completed by the SIU before they are made public.
The SIU’s work reveals some of the scale of South Africa’s corruption problem in the past 15 years.
There were allegations of widespread corruption in lucrative government contracts during the administration of former President Jacob Zuma, who led Africa’s most advanced economy for nine years but resigned in 2018 amid the allegations.
A judicial investigation in high-level corruption at the time involved numerous government officials and executives at state-owned companies accepting bribes and kickbacks from businessmen in exchange for government contracts or favors. The culture of corruption permeated all levels of government, the allegations said. Hardly anyone involved be prosecuted.
It had devastating consequences for South Africa’s economy, including the near collapse of electricity supply due to corruption and mismanagement at energy utility Eskom, a company at the centre of many of the scandals. South Africa was hit by record levels of nationwide blackouts last year due to the crisis at Eskom.
More than 270 Eskom contracts, worth approximately $2.2 billion, are currently under investigation in a six-year SIU investigation.
Investigators believe $540 million was lost to corruption at passenger train operator PRASA, some of it through a scheme in which money was allegedly stolen through payments to more than 1,200 “ghost employees” who did not exist, the SIU report said. One contract under investigation, worth more than $300 million, dates back to the 2010 World Cup, which South Africa hosted.
The then ruling party of the African National Congress in South Africa was synonymous with accusations of corruption during Zuma’s presidency. Corruption was a central problem in this year’s national elections in South Africa, when the infected ANC lost its majority for the first time since the country became a democracy after the end of the white-minority apartheid regime in 1994 in parliament.
Current President Cyril Ramaphosa has promised to clean up his party and government and bring those responsible to justice. However, anti-corruption experts say it is unlikely much of the money will be recovered.
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