The Zuma moment: between tender-based capitalists and radical economic transformation

ABSTRACT

The Jacob Zuma Presidency (2009–2017) was dogged by persistent allegations of corruption and the looting of State Owned Enterprises (SOE’s) by those allied to him. It led to allegations of state capture that placed the Gupta family at the centre of this project. These allegations have been highly contested, with Zuma supporters arguing that he has come under attack because of his support for the BRICS alliance (Brazil, Russia, India, China, South Africa), which they hold challenges Western imperial interests. Alongside this are those aligned to the Gupta family, arguing that the real culprits of state capture, both historically and in contemporary South Africa, is White Monopoly Capital (WMC), through its ability to determine macro-economic policy. At the heart of this contest is what has come to be known as tender-based capitalists who sought to use access to SOE’s for the accumulation of capital. This process has been defended on the basis that it has the potential to lead a radical economic transformation (RET) that that can challenge the power of WMC. Others have held that this argument is a mere fig leaf for the looting of state coffers, eroding its capacity for deeper developmental initiatives and fostering a parasitic class. This article that focusses on this debate that entered the heart of the African National Congress (ANC) and threatened to tear it apart takes the form of a conjunctural analysis; conjuncture defined as an amalgam ‘of circumstances, a convergence of events, an intersection of contingencies and necessities, a complex, overdetermined state of affairs-usually producing a crisis, leading to breaking point, driving to historic crossroads’ (Mowitt 2015, 125).

KEYWORDS:

• State capture
• radical economic transformation
• monopoly capital
• Guptas

Disclosure statement

No potential conflict of interest was reported by the author.

Notes on contributor

Ashwin Desai is Professor of Sociology at the University of Johannesburg. Professor Desai has written extensively on the sociology of sport, social movements and the Indian community.

Notes

1 Jonas told the Protector that he had been offered 600 m South African rands (around $44 m as calculated in November 2016) by Ajay Gupta to agree to be appointed finance minister and use his position to replace some of the executives in the National Treasury who were a ‘stumbling block’ to the Gupta family’s business ambitions. Jonas declined the offer. Finance Minister Nhlanhla Nene was replaced by Van Rooyen, then a little known backbencher. The report stated that Van Rooyen had spent a considerable amount of time with the Guptas, including their Saxonwold, Johannesburg residence many times, and on the day before he was announced as Minister.

2 Between 2 August 2015 and 22 March 2016, Eskom CEO Brain Molefe called Ajay Gupta 44 times while Ajay called Molefe 14 times. Eskom’s awarding of a coal contract to Tegeta was irregular and the Eskom board was improperly appointed. Molefe initially tried to laugh off the suggestions, stating that he visited a shebeen in the area. However, public pressure forced him to resign in December 2016. In true Zuma-fashion, he was back in the limelight when the ANC appointed him as MP in February 2017. Opposition parties feared that he would be put into the National Treasury to strengthen the Gupta-Zuma control of the fiscus.

3 One should be reminded that Mbalula was involved in what could be argued was a curtain-raiser to the Gupta’s state capture. This centred around businessman Brett Kebble, who despite being white, tried to take on old white capital at the turn of the new millennium. Kebble targeted the ANC Youth League (ANCYL) and focused his attempts at wealth accumulation by dubious means. The Youth League had a reputation for periodically questioning ANC policy and spearheading generational change within the party, thus making individuals ideal targets for a business person with a long view on state capture to invest in. Kebble bought and ended up running iconic mining companies, Western Areas, JCI and Randgold & Exploration into the ground, while over R2 billion worth of assets somehow dissipated.

As Barry Sergeant lays bare in his book The Kebble Collusion (2012), Kebble

… focused on forging ties with various individuals in politics, law enforcement and the intelligence services. He also focused on forging ties with various individuals in politics, law enforcement and the intelligence services. He also focused, in particular, on developing close ties with the leadership of the ANC Youth League, financing a number of its functions, and co-opting the organisation into various “black empowerment” deals. (2012, 245)

Fikile Mbalula admitted that Kebble’s relationship with the youth league and its leaders was symbiotic: ‘He wanted political capital out of that relationship to advance his business interests and the youth league wanted to advance its business interests’ (Rossouw 2011).

4 Evidence emerged that Bell Pottinger masterminded a social media campaign to divert attention from the Guptas’ involvement in state capture by emphasising the role of white monopoly capital in the South African economy. They came up with such slogans as #endeconomicapartheid, while besmirching journalists, politicians, and government officials who exposed Gupta-linked corruption. Bell Pottinger also drafted some of the inflammatory speeches made by the ANC Youth League. The DA submitted a formal complaint with the UK-based public relations industry body that Bell Pottinger, by acting unethically, had manipulated public opinion to create racial divisions in South Africa. In July 2017, days before it was due to appear before the Public Relations Communications Association and the Chartered Institute of Public Relations, Bell Pottinger issued a public apology to South Africans for the racial tensions it had fomented in the country and dismissed the lead partner involved (Thamm 2017). It is of more than passing interest that one of Bell Pottinger’s clients is none other than Richemont, owned by Johann Rupert. Richemont cancelled its account with Bell Pottinger once association with the Guptas became public.