EXCLUSIVE: How SA’s energy crisis was used as a stepping stone for renewed State Capture


Ayanda Mdluli

JOHANNESBURG- President Cyril Ramaphosa’s investment overdrive, which has set a target of raising R1.4 trillion in order to bolster the South African economy has raised more questions than answers as accusations continue to fly in that those who are in close proximity to the president, such as family members, friends and close comrades will be the beneficiaries of what is being terms as the “grandest case political patronage” that the country has ever seen.


Just recently, businessman Patrice Motsepe, the president’s brother-in-law, and the brother-in-law of Jeff Radebe, the minister of Energy formed part of a delegation that raised a staggering US$ 20 billion from the Saudi government to invest in South Africa. A huge portion of these funds would go towards financing SA’s renewable energy projects, the 27 Independent Power Producers (IPPs) that were signed into effect by Radebe in April this year.


What is interesting to note is that a further US$ 600 million was pledged at the recent BRICS Summit by the New Development Bank, which would see the money being invested into the 27 IPPs that were signed into effect by the president’s brother-in-law. Nhlanhla Nene, South Africa’s minister of Finance and staunch ally of the president is the chairman of the New Development Bank.


These developments have raised eyebrows and the general sentiment within SA’s energy industry is that Radebe was appointed the minister of Energy to implement the IPPs within a short space of time to companies that are linked to the president and his family.


Africa News 24-7 can reveal that individuals working closely with the minister in the Energy Department have expressed shock and are perplexed at how he signed the 27 IPPs “without familiarizing himself with the facts” as he had never served in the energy portfolio prior to his appointment, yet within a month he signed a deal that has massive economic implications to South Africa’s energy requirements.


Some senior executives within the Department of Energy claim that Radebe’s appointment constitutes nepotism, conflict of interest, corruption and an unfair advantage because of his family ties with the president and Motsepe who has a massive stake in African Rainbow Energy and Power, a renewable energy company that may be directly or indirectly benefiting from the IPPs. This has led to speculation, particularly in some ANC and business circles that the Motsepe’s have finally captured the state after more than 24 years of being in close proximity to all previous presidents post 1994.


Radebe was asked to comment, however, his head of communications Thandiwe Maimane passed on the questions to a Mmabatho Ramompi who pulled a disappearing act and went to ground when Africa News 24-7 approached and pressed her for comment.


An Africa News 24-7 investigation can also exclusively reveal that Radebe, was personally deployed by the president to the department of energy to fast-track the signing of the IPPs where companies affiliated to the president and his brother-in-law stand to benefit.


An executive operating in Radebe’s department said: “When you look at what is happening around us you need to ask yourself, is this not blatant corruption, collusion, conflict of interest, nepotism and unfair advantage? It took Mr Radebe less than a month after his appointment to sign the IPPs, what was the urgency about when he could not have familiarized himself with the facts in such a short space of time. This is clear that the signing of the IPPs is a mandate from the president. A lot of us were shocked at how everything happened. It was too swift,” he said.


What is said to be even more baffling for government executives in both the Presidency and the Department of Energy is that Ramaphosa took over the reigns of the ANC on an anti-corruption ticket and was very vocal on state capture. Africa News 24-7 has received a series of complaints from senior ANC NEC members as well as high ranking government officials and alliance partners. Most of them centre around the fact, that since coming to power in February, the president has been swift in appointing people close to him to key positions both in government and state-owned entities.


A high ranking official in the ANC NEC commented: “An example of this is that Jeff Rabebe, his brother-in-law was appointed as Minister of energy, while Jabu Mabuza, a close friend of the president was appointed as chairman of Eskom. Individuals such as Sifiso Dabengwa, Pravin Gordhan and Gwede Mantashe have been elevated to key-board memberships and ministerial positions in Government and state-owned entities. This is the grandest case of sophisticated political patronage that the African continent has ever seen.”


“This has left us with more questions than answers. Yes, South Africa is in dire need of investment, but at what cost? At the cost of those who are putting their friends and family first, over and above the interests of the majority. The fact that there are companies linked to Mr Ramaphosa’s businesses that are locked in a blind trust, is this not conflict of interest or corruption for the president to take his brother-in-law who has business interests in energy to a delegation to Saudi Arabia?”


Legally, under the South African law, there is no such thing as a blind trust and Africa News 24-7 has been reliably informed by sources close to the president that his businesses still belong to him and that he will resume direct ownership when he steps down as president of South Africa.


Africa News 24-7 sent questions to the presidency in order to give them a right of reply, however, two weeks later, there was no response, let alone an acknowledgement of receipt which raises even more questions from sources who spoke to Africa News 24-7.


However, speaking on behalf of Patrice Motsepe, Jongisa Magagula, the head of investor relations at African Rainbow Minerals said: “Dr Patrice Motsepe has been on several trade missions over the past 24 years which were led by all the previous presidents of South Africa, starting with Dr Nelson Mandela and has often done so in his capacity as a globally respected business person who was seeking to promote investment in South Africa. We are conscious of his relationship with certain senior governmental officials and his commitment since our democracy in 1994 to zero tolerance of corruption in his dealings with previous senior governmental officials will continue with the current and future senior governmental officials,” she said.