Publication: The Times Issued: Date: 2008-03-23 Reporter:

What is Mbeki Trying to Hide?

 

Publication 

The Times

Date

2008-03-23

Web Link

www.thetimes.co.za


"Why the sacrifice of Parliament's oversight role, and untruth upon untruth from the President and a number of Cabinet ministers?"

"Sources close to the German investigation say that a very senior ANC politician was a beneficiary of successful German bidders' largesse"

Thanks no doubt to score-settling inside the ANC, a glut of new information is emerging about the discredited arms deal ­ and much of it features the name of the President, writes Andrew Feinstein

Recent revelations concerning South Africa's controversial multimillion-rand arms deal appropriately place President Thabo Mbeki at the centre of the deal and its machinations.

Last week the Sunday Times reported that members of the ANC's National Executive Committee had exhorted the President to come clean on allegations that he was a recipient of bribes in relation to the German component of the arms deal.

The Mail & Guardian has revealed that Tony Georgiadis, a shadowy businessman with links to Joe Modise and Mbeki, paid money into ANC coffers and a number of charities after receiving 22-million from Thyssen Krupp, a German company involved in the German Frigate Consortium (GFC), which was a beneficiary of the deal.

According to this and other reports, a major part of the amount was allegedly channelled to "South African officials and Cabinet ministers". As chairman of the Cabinet sub-committee tasked with overseeing the deal, Mbeki was a key decision-maker in the process. He was particularly involved in the GFC deal.

Early on in the technical phase of the process to decide who would build the four ships required, there was an understanding in the navy that a Spanish company was best placed to meet the requirements. However, after a visit to Germany by then-deputy president Mbeki, the tender was reopened .

Soon thereafter Mo Shaik (brother of Chippy, then head of procurement in the defence force, and the even-more notorious Schabir) was appointed South Africa's consul-general to Hamburg, home of the GFC. The appointment came as something of a surprise as Mo had no previous diplomatic or consular experience. A few months later it was announced that the contract had been awarded to the GFC. Our consulate in Hamburg was closed down and Mo moved on to become South Africa's ambassador to Algeria.

German prosecutors, investigating the payment of 25-million in "commissions" (arms industry lingo for bribes) are known to believe ­ based on minutes kept by Thyssen Krupp ­ that Chippy Shaik solicited and received 3-million and that a significant portion of the balance went to other senior South African officials and politicians.

In addition, the GFC awarded a crucial and lucrative subcontract on this deal to Thomsons-CSF, as French arms company Thint was then known. This was in preference to a cheaper South African bidder who was a long-time technical partner of the South African navy.

Thomsons, in turn, awarded a sizeable chunk of this subcontract to a company closely linked to Schabir Shaik ­ one with no track record in the manufacture of the highly technical components.

This is the same Thomsons which, according to the judgment in the Schabir Shaik trial, agreed to pay Jacob Zuma R500 000 a year to further its interests and protect it from investigation in relation to the deal.

Interestingly, when it was raised in the Shaik trial that Mbeki too had held a meeting with Thomsons, the President's office vehemently denied this. In fact, Mbeki met the company's three most senior executives in Paris on December 17 1998. Once this information was made public, the President claimed he had forgotten about the meeting as it was of no significance *1.

There are suggestions in the court record that this might have been one of a number of meetings between the President and Thomsons.

So why the vehement denials from the President? And why the expending of so much political capital on the failed cover-up of the deal? Why the sacrifice of Parliament's oversight role; the distortion *2 of legal advice in order to justify excluding the Heath unit from the investigation; interference with the investigators in the form of directives as to who and what they could and could not investigate; and untruth upon untruth from the President and a number of Cabinet ministers *3, which subsequent events (and trials) have embarrassingly exposed?

In a veiled warning of unforeseen consequences, Zuma's legal team has stated on more than one occasion that they would need to call the President as a witness in Zuma's corruption trial as he is the only one who knows whether the arms deal was corrupt or not. It is interesting that Zuma's desperate trip to Mauritius in an attempt to persuade that country's political leaders to stop their authorities from sending important evidence to their South African counterparts was followed within a fortnight by a scuttling Presidential visit.

So what is President Mbeki going to such lengths to hide? *4

In my investigations into the arms deal, while an ANC MP and subsequently in researching my book, After the Party, initially only one investigator ever claimed there was evidence of Mbeki benefiting personally from the deal. Instead, it was suggested that he solicited money for the ANC in return for which he distorted the procurement process to favour those generous companies.

However, sources I speak to who are close to the German investigation have claimed for a number of years that a very senior ANC politician was also a beneficiary of successful German bidders' largesse. They have not as yet revealed who that politician is.

The arms deal clouds hanging over Mbeki and the ANC were further darkened late last week by reports that the Scorpions have reopened the investigation into the BAE Systems contract. BAE is the British arms company which received the deal's biggest contract, despite its offering being unwanted by the air force and costing two and half times the price of the favoured Italian alternative.

BAE is facing about a dozen investigations in various parts of the world into corruption and bribery in arms deals. The UK's Serious Fraud Office has been investigating £75-million of commissions on BAE's highly controversial South African contract, paid to notorious agents, senior South African officials and politicians.

While it is known that Mbeki interacted extensively with representatives of the British government on this deal, it is as yet unclear what contact he had with BAE itself or any of its agents.

What we do know is that Mbeki was complicit in allowing the procurement criteria to be shamelessly altered (including the omission of cost as a criteria on this most expensive component of the entire deal) in order to favour BAE. He also agreed that an informal briefing ­ at which he was present and where the merits of the favoured Italian alternative were not even discussed ­ could be formalised post facto into a decision-making meeting of the Cabinet subcommittee he chaired.

What is clear is that there remain an enormous number of questions about the President's role in many aspects of this and other deals . Similarly, the roles of Joe Modise, his political adviser Fana Hlongwane, Chippy Shaik and others are still to be fully revealed.

It is, of course, possible that the glut of information now emerging about the arms deal is simply the consequence of score-settling within the divided ruling party. However, it is as possible that amidst these political machinations grains of truth are being unearthed.

International experience suggests that a large part of the truth of these unedifying arms deals always emerges eventually, especially during times of political upheaval. When the truth about India's notorious Bofors arms deal finally became known, 14 years after the deal was signed, it was political infighting among the ruling party that led to crucial information being made public.

More about the South African arms deal will undoubtedly emerge during the Zuma corruption trial. And it is worth bearing in mind that, now that the net is finally being cast wider, this does not imply that those already convicted or facing trial are any less guilty.

Of course, the ideal way for the country to be fully informed of the whole truth of the arms deal is for the government to constitute an independent, unfettered judicial and expert commission of inquiry into the deal.

The idea of some sort of amnesty in relation to the deal has also been mooted. This would only contribute to the national good if it was granted in return for full disclosure, withdrawal from public life and the return of ill-gotten gains.

Anything less would add further insult to the years of wasted expenditure on underutilised arms, the undermining of our institutions of accountability, the cover-ups and the lies.

Feinstein is a former ANC MP and the author of the bestselling After the Party: A Personal and Political Journey Inside the ANC, published by Jonathan Ball.

With acknowledgements to The Times.



*1       It is of such significance that it could send Mr Mbeki to jail.

If there was an innocent explanation for the meeting, non non - series of meetings, then Mbeki would both remember the meetin(s) and provide such explanation(s) - but that he claims that he cannot remember them results of the only conclusion possible and that is severe wrongdoing.


*2      This in itself should have led to the most severe sanction possible - i.e. impeachment.


*3      In particular, Pinnoccio Erwin - the most savory of them all.


*4      Indeed what.

His own  role - that's what.