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Lincoln Wright
Lincoln Wright

Apartheid Guns And Money


From a modest office in a rundown suburb of Cape Town, Van Vuuren has been beavering away to probe into the stories that could never be told during the apartheid years. Formerly director at the Institute for Security Studies, he now runs Open Secrets, which peers into economic and human rights violations. This volume, first published in South African in 2017, is the result.




Apartheid Guns And Money



In February 2018, a number of South African civil society organisations, including Corruption Watch, Foundation for Human Rights and Open Secrets, convened a People's Tribunal on Economic Crime. Over five days, the Tribunal, presided over by prominent South African and international legal experts and human rights activists, heard evidence and arguments on the creation and maintenance of a 'labyrinth of devious structures and routes ' (2) employed by foreign governments, banks, corporations, private sector individuals and their middlemen for more than four decades to circumvent the arms embargo imposed by the UN Security Council against apartheid South Africa in 1977.


The UN General Assembly and Security Council had consistently condemned apartheid as contrary to the UN Charter and, in 1966, the General Assembly declared apartheid a crime against humanity. In 1977, in response to the increasing violence executed by the apartheid state against the majority of its citizens, in particular the crushing of the 1976 Soweto student uprising, the Security Council imposed Resolution 418, a universal mandatory arms embargo against South Africa. The Resolution prohibited the provision of 'weapons and ammunition, military vehicles and equipment, paramilitary police equipment' to South Africa and any grants of licence 'for [their] manufacture or maintenance'. (3)


In forging its future, a new generation of South Africans need to grapple with the baffling silence regarding apartheid-era economic crime and ask difficult questions of those who profited from it. This book provides the evidence and the motivation to do so.


The biggest mystery about apartheid has been solved. We now know how the apartheid regime in Pretoria could continue to buy arms after the global mandatory arms embargo in 1977. Sanctions-busting prolonged the life of white rule and created the conditions, networks and bad habits that linger on today.


The atmosphere is tense as she asks some awkward questions in this business-like and high-powered environment. Will the Kredietbank continue to prop up apartheid? Will this Christian bank continue its lending to strategically important state-owned enterprises in South Africa and to the independent homelands? If so, her Catholic congregation will close its bank accounts with the Kredietbank because of its unethical behaviour.


Hennie van Vuuren, South African activist and director of Open Secrets, has painstakingly traced the illicit ways foreign bankers, spies, undercover agents, arms dealers and arms producers maintained a covert global network to arm apartheid.


Hennie has been scrutinising for five years declassified state records and affidavits of various trials in courts in Lisbon, Paris, Brussels and Luxembourg. He has made hundreds of interviews to reveal the illicit networks that have fuelled the apartheid machine.


KBL, through this carefully devised network, assisted in a massive money laundering scheme. It acted on almost weekly instructions of 25 ARMSCOR operators, housed on a secret floor of the South African embassy in Paris.


The key operator admitted that KBL facilitated up to 70% of all illegal purchases in the 15 years of sanctions-busting. Given the nature and the volume of these deals, the senior bank management must have known and condoned these illicit transactions, which oiled the wheels of the apartheid military.


The unrest continued the following year with further clampdowns on peaceful opposition organisations. It culminated in the brutal murder of anti-apartheid activist Steve Biko while he was being detained by state security.


They demand a public apology by the culprits. The NGOs also ask the OECD and its members to develop more effective and binding mechanisms to hold corporations accountable for their complicity in apartheid and other violations of human rights.


This way, South African NGOs have finished the job that nuns and the anti-apartheid campaigners started 30 years ago. But the job of vigilantly pushing for transparency and ethical standards in global dealings by the private sector is far from over.


All through the time when the South African apartheid state was at war, a global covert network of nearly 50 countries, various banks, corporations and intelligence agencies worked to supply guns and goods to the pariah regime for hard cash. And at a healthy profit too.


There was rampant money-laundering during apartheid, through supposedly reputable international banks, by the state-owned arms company, Armscor. It deployed its networks of international arms dealers and fixers to deliver the weapons and pay the money that kept the war going, against both the black majority in South Africa and neighbouring states such as Angola and Namibia.


No doubt in more recent years, similar channels were also exploited by the Zuma family and the Gupta brothers, as they money-laundered through Dubai and Hong Kong the billions of rand they looted from taxpayers.


Inside the country, in June 1988, another even more comprehensive and stringent state of emergency was declared, with the imposition of martial law. Then the onslaught began. Organisations were banned, open-air gatherings prohibited and the police and military moved into the townships to detain 30,000 people. The government recruited vigilante bands, which they paid, armed and turned loose on radical township activists. Homes were burned and the offices of anti-apartheid organisations bombed. The security forces looked on, content that their clandestine plan of organising these vigilantes was proving fruitful. Despite denials at the time, it was confirmed in the 1990s that this strategy was authorised at the highest level of the government.


But Van Vuuren says in his book, before parting ways, Göttert linked Zuma to another bounty hunter, former British secret agent Michael Oatley. He is the author of the Ciex report, which claims Absa owes the state billions of rands in repayment of an apartheid-era bailout of the Bankorp group it later acquired.


Before one can consider South Africa though, there should be an acknowledgement of its legacy of apartheid. In this regard, it is common cause that the system was immoral, and its implementation brutal. It left the country with structural fault lines that will be part of the South African reality for many decades to come.


During 1970 to late 1980s the apartheid regime also followed the mainly Keynesian approach of trying to create growth through increased inflation and the printing of money. Notwithstanding, a more market-driven economy emerged mainly as a result of rapid industrialization.


Not all prominent members of the ANC/SACP alliance found their home in Tanzania and other African countries while receiving training from China and Moscow. Prominent members also went in exile in Britain and Ireland, notably Vella Pillay, Tennyson Makiwane, Abdul Minty, Yusuf Dadoo, Kader Asmal, Oliver Tambo and later Thabo Mbeki and the Pahad brothers (Aziz and Essop) ( -anti-apartheid-movement).


The people in charge of that money were at the forum to learn the nuts and bolts of fossil fuel divestment: Does it make financial sense? Will it have an impact? How can it be done? The main day of presentations included speakers from senior management of Morgan Stanley Capital International, Boston Common Asset Management, and Trillium Asset Management.


Like Cry Freedom, A Dry White Season shows a comfortable white middle-aged man gradually waking up to the vicious inhumanity of the apartheid system. But it is altogether more rooted in the bitter experience of black people. As the story unfolds in the immediate aftermath of the 1976 Soweto Uprising, we see how two families, one black and one white, are destroyed - and the black actors are all South Africans themselves rather than US imports.


A Dry White Season is all that we could ask of a Hollywood movie about South Africa. It leads the unconverted and naive step by step into understanding - and then stares the brutality of apartheid straight in the face.


This is about 'Money, People and Power from West to East', as the subtitle to the book explains. It looks at the explosion of mobile, global money in the 1980s encouraged by the electronics communications revolution, and how it affects people's lives.


But Sampson fails to explore seriously the catastrophic drop in commodity prices which fuelled the 'junk money' boom. The book's slim nature - it lacks the rich research which illuminated The Arms Bazaar or The Sovereign State of ITT - is also a disappointment.


Sampson's usual strengths and weaknesses are on display. He chooses to investigate the big issues. His writing is a joy, combining the telling quote from finance megastars with anecdote to illustrate a substantial point. And the complexities of economics are clearly and entertainingly explained. It's an object lesson for all feature writers. On the debit side, he frustratingly falls short of any overarching analysis. Here is the social democrat refusing to condemn the absurdities he chronicles so well; or simply producing half-baked observations. Humans, we are told, never tolerate for long the predatory and revolutionary power of money without constraining it. Really?


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