Tebogo Khaas: The right track, or Sino abyss?
Many fear that President Cyril Ramaphosa’s determination and methods to save a beleaguered ANC could, paradoxically, become a petri dish for moral hazard and economic calamity in our society.
A minimum fealty to the truth demands that we do not ignore these fears or throw caution to the wind.
Let me explain.
For a fleeting moment when the Brics cavalcade was in town a few weeks ago, there seemed to have been no doubt as to who the alpha male was as South Africa assumed the chair of the geopolitical body with aplomb.
If, as they say, “diplomacy is the ability to tell someone to go to hell in such a way that they still look forward to the journey”, then Russian President Vladimir Putin’s journey back home – sans the much-derided nuclear power deal – must have been a pleasant one.
Although South Africa remains one of the biggest hubs of foreign direct investment in Africa, the systemic risk to the economy posed by a potential Eskom financial default, coupled with wanton corruption, militates against Ramaphosa’s drive to help revive our ailing economy.
Suspiciously choreographed with Ramaphosa in anticipation of meetings with Russia and China, Eskom lifted its petticoat to reveal an even more unflattering balance sheet than had been made known publicly before.
Eskom’s timely public release of its financial statements seemed useful in placating an apparently exasperated Putin who must still be smarting from the widely castigated nuclear deal that Ramaphosa was compelled to nix.
China, Africa’s blesser-in-chief, and South Africa used the Brics summit as a backdrop to announce a much-needed R33bn loan to Eskom. It is feared, though, that a “messianic” China could signal South Africa’s descent into a debt trap, given our already bloated public debt and enormously shrunken fiscal capabilities.
A visibly emboldened and excited ANC treasurer-general, Paul Mashatile, didn’t waste time inviting equity partners in state-owned enterprises (SOEs) soon after this announcement.
Considering the ANC’s close relationship with the Communist Party of China, it is not inconceivable that China’s multibillion-rand loan to our beleaguered electricity supply behemoth could strategically be converted into equity.
For, in a bid to bolster its position as a maritime powerhouse, secure key supply chains, enhance its international trade capacities and build up geo-economic leverage, China has been buying up the development and operational rights to a chain of power plants and ports that stretch from the southern realms of Asia to the Middle East, Africa, Europe and even South America.
The possibility of China acquiring Eskom and other strategic SOEs, such as the Port of Ngqura northeast of Port Elizabeth, have now taken on a booming significance as China’s intercontinental network begins to take shape. China, a quasi-communist state flush with capital, must be licking its chops at the prospect of advancing its global strategic framework.
Our only saving grace against possible Sino economic hitmen could be our procurement framework which should bar China’s preference for corrupt “no-bids” on large foreign infrastructure projects and land acquisitions.
It is worth noting that Malaysia recently suspended four China-linked projects which they assert are lopsided. Objections to Chinese investments in Malaysia have focused on the presence of thousands of Chinese workers, heavy dependence on Chinese materials and limited opportunities for local companies.
Thus, although China’s capital injections into South Arica would provide a timely reprieve and boost to our ailing Eskom, care must be taken to ensure South Africa doesn’t make similar mistakes, as happened in Sri Lanka, Pakistan, Montenegro, Nicaragua, Djibouti, Uganda, Angola and elsewhere.
The complexity, capriciousness and invisibility of China’s foreign soft power diplomacy through economic power could end up with tears flooding dry riverbeds across our hinterland.
China’s greed and corruption is matched only by our own, due to lack of consequences and public shame. One only needs to mention China South Rails and China North Rails as examples of two Chinese state-owned entities that have aided corruption at Transnet and the Passenger Rail Agency of SA.
It is hard to overstate the corrosive effect greed – fuelled by money, power and privilege – has on our body politic. It is even harder to ignore the extent to which corruption has impeded our developmental agenda.
The inexorable pull of greed and vice pose the biggest impediments to Ramaphosa realising his ideals.
The previous ANC administration was a festering pit of barely disguised corruption. But the whole sordid era did not have a period quite like the orgy of criminal consternation that we are currently experiencing.
Events of the past few months are a far cry from the tempestuous roller coaster ride we endured under Ramaphosa’s predecessor.
Okay, I know the bar has been lowered!
But as Ramaphosa enters one of the most difficult periods of his presidency – with the elections looming – it is only fair to acknowledge that the president seems to be on the right track.
In private, however, more prominent supporters of Ramaphosa and intellectuals are expressing disquiet about his recent handling of the land discourse; ill-timed “validation” of a still-contested electoral outcome in Zimbabwe; unbridled fealty to his personal lawyer who is accused of having a conflict in matters of national interest; and apparent acquiescence with venality within his party and government administration – ostensibly in pursuit of “unity”.
It has been frequently noted that Ramaphosa is trying to remould the ANC in Mandela’s image. Likewise, the president is trying to mould the governing class after his personal and business ethos.
But, unlike Mandela, Ramaphosa could be staring into the Sino abyss.
- Khaas is trustee of the SA Institute of Public Interest. Follow him on Twitter @tebogokhaas