South Africa: State Capture Report Highlights the Economic and Investment Risks of a Failed and Looted Government

analysis

The first volume of Judge Raymond Zondo's report on State Capture lays bare why investment flows into South Africa have been so meagre. A failed and looted state is a magnet for criminals, not legitimate investment.

The word 'investment' appears 11 times in the 874 pages of the Judicial Commission of Inquiry into State Capture Report: Part 1. Yet the document will be scrutinised closely by the investment community and it lays bare a salient fact: a captured state is a failing state, and a failing state is the biggest deterrent there is to investment.

The business and investment community struggles daily with the consequences of the State Capture era.

"Bulk commodity exporters have ... experienced an opportunity cost of at least R30-billion because of the inability by Transnet to provide a contracted service to deliver iron ore, coal, chrome and manganese to the ports," Minerals Council South Africa, the main industry body representing the mining sector, noted on Thursday.

"The reasons given by Transnet include crime on its rail network, which speaks to ineffectual policing by the state on a strategic national asset, and the difficulties to procure spares for locomotives bought in a multibillion-rand programme cancerous with corruption....

AllAfrica publishes around 500 reports a day from more than 100 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.

X