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January 18, 2021

SAFTU calls on Deputy Justice Zondo to demand testimony from President Ramaphosa

The testimony of former CEO of Eskom, Transnet and the Public Investment Corporation Brian Molefe, at the Zondo Commission today, January 15, 2021 included damning allegations against President Cyril Ramaphosa.
SAFTU calls on the Zondo Commission to request the audience of President Ramaphosa and all the Directors of the firms Glencore and Optimum to testify, in order to be provided an opportunity to put forward their side of the story.
We understand that Judge Zondo must now be in physical isolation, for fear that Covid-19 has spread into the Commission rooms. SAFTU leaders and workers have suffered enormously from the virus, and we wish him all strength and hope for the best, that he was not infected. Nevertheless, if he is well next week, and if he is able to work remotely, we join the rest of South Africa in desiring full transparency about President Ramaphosa’s behaviour as a corporate tycoon, allegedly influencing our state on behalf of international capitalists.
The allegations made by Molefe are certainly damning! He offered a different narrative to the notion that state capture occurred purely via the Gupta empire. It is a narrative often ignored by the mainstream media but one that desperately needs thorough investigation.
Specifically, Molefe attacked the former owner of Optimum Coal Mine, which is South Africa’s sixth largest but one unwilling to provide good quality coal to Eskom from 2012-15 because, Molefe argued, it shipped its better coal abroad instead of supplying the parastatal’s power plants, since export prices were far higher.
The owner was Glencore, the world’s largest commodity trader, a firm that has achieved a terrible notoriety because of ongoing investigations into its allegedly corrupt activities, by authorities from several countries, including the United States, United Kingdom and its home country of Switzerland. Charges include money laundering and bribery in Nigeria, Venezuela and the Democratic Republic of Congo. And now Glencore’s South African operations are in question.
Because of this history, we should consider Molefe’s testimony seriously; it includes these points:

  1. Glencore sold shares to Ramaphosa and in 2012 made him local board chairperson of one of its main local assets, Optimum, allegedly so he would use his political connections as former African National Congress Secretary General to its benefit – and indeed later that year, Ramaphosa became ANC Deputy President.
  2. Glencore’s Optimum coal mine owed Eskom R2 billion in penalties at the time, but the parastatal did not get this money back, with Molefe implying that this was because Glencore had friends in high places, politically.
  3. Glencore wanted to renegotiate its coal sales prices from R150 per ton to R530 per ton as a result of the commodity price super-cycle and the crashing value of the South African rand, which was to cost Eskom R8 billion more.
  4. But after becoming the country’s Deputy President in 2014, Ramaphosa soon came to chair the government’s Eskom War Room, designed to halt the load-shedding crisis – but apparently still had not sold his Shanduka mining interests.
  5. From this utterly ineffectual War Room, Ramaphosa allegedly forced Eskom’s executives to provide weekly reports, which were operationally meaningless but which provided essential commercial information to Ramaphosa, who was conflicted by his ongoing 9.4% shareholding in Optimum.

For many decades, just four large mining conglomerates had supplied 80% of Eskom’s coal requirements. These companies included Glencore via Optimum, while a small company called Tegeta Exploration & Resources only provided around 4% of Eskom coal. Yet because of the then Mining Minister Mosebenzi Zwane’s apparent in-person pressure on Glencore to sell Optimum to the Guptas in late 2015, all the attention has been placed on Tegeta and its holding company Oakbay, instead of the other alleged capturers of Eskom, Glencore.
These allegations are very serious and cannot be left unverified. SAFTU believes that Zondo Commission’s own credibility depends on probing these allegations and getting all the Directors of Glencore/Optimum – and the rest of the companies that had enjoyed an oligopoly providing coal to Eskom – with contracts negotiated 40 years ago.
If this sort of corporate malfeasance is proven to have occurred, SAFTU will be vindicated, in that our founding congress in 2017 took the view that there are no angels left in the ruling party. Both the Zuma and Ramaphosa factions are to varying degrees guilty of such extreme state and corporate corruption, that they have together robbed the country’s youth and poor of their future and of the right to a better life for all.
Both factions’ leading personalities have greasy hands, and have committed untold sins against the poor, against our economy more generally since the costs of load-shedding are easily in the hundreds of billions of rands, as well as against South Africa’s natural environment – insofar as Ramaphosa’s Shanduka, Glencore, Optimum and other coal mines were caught cheating on water use licenses, polluting local land and air, and contributing to the climate crisis, by externalising their immense social, economic and ecological costs on all the rest of us.
We know that Brian Molefe and the Gupta empire deservedly have extremely poor reputations. We anticipate even more controversy from former Transnet and Eskom treasurer Anoj Singh when his affidavit to the Commission is presented on Monday.
But while their ally, former President Zuma, continues to dig his own political and reputational grave ever deeper by suspiciously refusing to appear before the Commission, we also profoundly regret the failure of the media and opposition parties, as well as civil society, to insist that Ramaphosa reveal the origins of his own obscene wealth. We would hope for more information about the various manifestations of state capture, if he is called before the Commission.
We witnessed the President’s dodging of Farlam Commission findings that while on the board of Lonmin, not only did he email to the police minister a call for “concomitant action” against what he termed “dastardly criminal” mineworkers on a wildcat strike, desperately seeking a living wage, the day before the Marikana Massacre of 34 of these workers. He also was instrumental in maintaining Lonmin’s system of flooding “Illicit Financial Flows” to Bermuda for alleged marketing expenses.
At the same time, his chairing of MTN coincided not only with that firm’s Illicit Financial Flows to Mauritius from many African locations, but with MTN’s alleged bribery of the South African ambassador to Iran so as to acquire a massive contract contested by a Turkish firm, according to an MTN whistleblower. MTN is also in trouble and has already paid billions of rands in fines, for its burner-phone collusion with Nigerian Islamic extremists, with similar allegations now in the U.S. courts about MTN’s alliance with Afghanistan Taliban extremists, both occurring with Ramaphosa in the chair. And Ramaphosa’s main firm, Shanduka, was also unveiled in the “Paradise Papers” for using Mauritius as a dodgy tax haven.
In sum, President Ramaphosa appears to be one of the reasons that throughout the 2010s, South Africa’s corporations were the regular winners of the PwC biannual “Economic Crime Survey”, as the most criminal elements in world business. It is long overdue for the Zondo Commission to aggressively investigate state capture by western multinational corporate tsotsis like Glencore, which is run by Johannesburg-born Ivan Glasenberg, and whose origins are in Marc Rich & Company. That firm grew rich by engaging in apartheid arms-trading and sanctions-busting, which Rich considered to be, as he put it, his “most important and most profitable” line of work.
The sickening stench of state capture now wafts from the entirety of the African National Congress and corporate South Africa. Riddled with corruption and exuding such levels of arrogance that Molefe and Zondo actually chuckled at each other’s jokes, it will not be surprising if our elites face the same kind of wrath that ruling classes now confront wherever working classes are in the streets campaigning for economic justice and genuine democracy.