Publication: Business Day Issued: Date: 2008-08-04 Reporter: Linda Ensor Reporter:

Come Clean, Opposition Urges Mbeki



Business Day

Date 2008-08-04
Reporter Linda Ensor
Web Link


President Thabo Mbeki faced mounting pressure from opposition parties yesterday to come clean about his alleged involvement in arms deal kickbacks amounting to R30m.

Cape Town President Thabo Mbeki faced mounting pressure from opposition parties yesterday to come clean about his alleged involvement in arms deal kickbacks amounting to R30m.

The latest explosive allegations that Mbeki personally engineered R30m in kickbacks mainly for the benefit of the ruling African National Congress (ANC) provides a politically incriminating backdrop for the party as its president, Jacob Zuma, enters the dock of the Pietermaritzburg High Court on charges of corruption. Mbeki allegedly gave Zuma R2m and the rest to the ANC.

The allegations in the Sunday Times suggested that it was not only Zuma that should be on trial but the ruling party itself and Mbeki, who strongly denied he had ever received any money from the German contractor allegedly involved.

Mbeki rejected the newspaper's allegations as spurious and said they were a "hotchpotch recycling" of others made previously. The allegations appeared to be motivated by a hidden agenda *1, a statement from the Presidency said.

Sunday Times editor Mondli Makhanya said it was important for the nation to know how it had been betrayed by its leader and how its money had been wasted, and to understand that constant vigilance was required to guard against corruption by leaders.

The Democratic Alliance (DA), Independent Democrats (ID) and United Democratic Movement (UDM) called for an independent judicial inquiry to investigate the latest allegations of corruption and were firmly opposed to any amnesty for offenders.

The urgent need for political party funding to be regulated was also highlighted by critics such as Institute of Security Studies researcher Hennie van Vuuren and the head of the Institute for Democracy in SA's Political Information and Monitoring Service, Judith February.

The Sunday Times article said the allegations stemmed from a report last year by a UK specialist risk consultancy into the international business activities of German shipbuilding giant MAN Ferrostaal. The newspaper claimed the company paid Mbeki R30m to guarantee it won the R6bn submarine contract, which it did, even though it was not one of the original short-listed bidders *2.

ID leader Patricia de Lille, who first blew the lid off arms deal corruption, said the latest allegations were in line with her original dossier, which was tabled in Parliament in 1999 and had led to the successful prosecution of former ANC chief whip Tony Yengeni and Zuma's financial adviser, Schabir Shaik, as well as charges being brought against Zuma.

De Lille said that according to her information, the German supplier made it on to the short list only after a visit by Mbeki to Germany *3. "It is no surprise to the ID that there is an orchestrated campaign under way to grant amnesty for corruption to those involved in the arms deal ," De Lille said.

DA leader Helen Zille said it was time for all those who solicited bribes in the arms deal to face the full force of the law. A judicial commission of inquiry was necessary, she said.

Zille said that if allegations of Mbeki's involvement were true, "it would show that the ANC is rotten to the core".

"It would explain why the president and the ANC have blocked every attempt to investigate the arms deal."

UDM leader Bantu Holomisa said only a judicial commission of inquiry could deal with the allegations of corruption surrounding the arms deal. The latest allegations explained "why the newly elected lynch mob that controls the ANC is reluctant to trust the judiciary, because they are aware of these shady dealings and schemes".

Van Vuuren was critical of the "disgraceful" fact that there was no transparency of political party funding, which was unregulated. He strongly condemned suggestions of an amnesty regarding the arms deal and said it was important that those involved in corruption were held to account.

With acknowledgements to LInda Ensor and Business Day.

*1       The allegations are motivated by the transparent and obligatory agenda of combating corruption.

*2*3    Patricia has got her patrol corvettes and submarines mixed up again.

The truth is that submarines were not on the SA Navy's shortlist of requirements. Only patrol corvettes, read light frigates, were a priority in 1995. This is clear because its three Type 12 frigates had been suck (SAS President Kruger) or inoperable (SAS President Steyn and SAS President Pretorius) by the early 1980s.

The SA Navy had three Daphne-class coastal submarines of 1970s vintage and on which it had spent a huge amount of money upgrading its combat suites (Projects Raka and Nickles) in order to keep them fully operational until 2010. This is worth investigating from the perspective of wasted expenditure.

However, when British Aerospace conjured up the idea of a Total Package Deal along with Joe Modise, Fana Hlongwane, Chippy Shaik, Alec Erwin, Thabo Mbeki, etc. and cooking up the idea of the Arms Deal, they offered 3 used Royal Navy Upholder diesel electric submarines for the deal.

This so tickled the fancy of the wonga recipients that the Government, not the SA Navy, decided not to keep the Daphnes going until 2010, but to scrap them with all undue haste and replace them.

But the SA Navy, DoD and Armscor never even had the original work done for the acquisition of a new weapon system and by the time the initial legally-required work was done the British Government had sold the Upholders to the unsuspecting Canadians.

This played right into Thabo's and Joe's hands because the "requirement" for a new submarine had been opened up and now Thabo could extend his deal with Helmut Kohl and the German shipbuilding industry.

So 4 submarines were shortlisted and the German one was nowhere close to the top of the list, until Ferrostaal of the German Submarine Consortium (GCC) offered nearly 10 times the required NIP, mainly in terms of a R6 billion stainless steel plant at Coega.

Matched to that was another steel facility offered by the German Frigate Consortium (GFC).

The Germans hunt in packs and the GFC's and GSC's NIP offers saw the Cabinet elevating their offers over the competitors (on paper with Tippex at least).

So the GFC was awarded the contract for the patrol corvettes and the GSC was awarded the contract for the submarines.

As soon as the ink was dry both reneged on their stainless steel plants.

So we are paying a substantial acquisition price and an almost unaffordable support cost for four frigates and three submarines and we've got no stainless steel plants.

So endth the lesson.