JOHANNESBURG, South Africa -- While flying here with a trade delegation the other day, U.S. Commerce Secretary William Daley asked the 15 business leaders on the plane for the biggest deterrent to investing in Africa.
"Corruption," was the one-word answer given by four out of five of the executives.
So serious is the problem here that the government of President Nelson Mandela recently held back-to-back summits on corruption and its antidote -- morality.
"Zero tolerance will be offered to the parasites who have scorned the public interest and sought self-enrichment at the state's expense," said Thabo Mbeki, Mandela's deputy and heir-apparent, who is in charge of the day-to-day running of government.
What alarms Mbeki and other leaders is that the country's first black majority government appears to be vexed by the same sort of bribery and corruption that tainted its white predecessor.
"The ghosts of yesteryear have reappeared, and their power of turning the fighter against the corrupter into the corrupted is evident for all to behold," Mbeki told the anti-corruption conference.
"Recent years have seen corruption become the misdirected juggernaut of society. In our country, it has succeeded in infesting our shared value system with moral decay and winning the hearts and minds of many a public servant.
"Not only those who exercise public power but large sections of the citizenry have been engulfed by the corrupting tentacles of this wayward beast that is threatening to destroy the soul of our nation and the very basis of our democracy."
In response, the government is considering stronger anti-corruption laws, increasing protection for "whistle-blowers" and tightening financial management and auditing systems. It is also negotiating with the unions on a code of ethics, meant to foster public honesty.
There is no definitive statistical evidence that corruption is worse now than it was during the years of apartheid. But, clearly, the perception of increasing corruption is being fed by greater media freedom under the new democracy, the commitment of the government to openness and the creation of an anti-corruption investigating unit.
Almost daily the media report examples of malfeasance, whether it's officials pocketing taxpayers' money, be it old-age pensions or school-meal funds, or demanding bribes for public services, such as driving licenses.
Businessmen have been found padding state invoices, and doctors bleeding the impoverished health service, all for personal gain. Criminals have bribed court officers to "lose" dockets. Prison officers have even opened cell doors for a fee.
So many government cars in the province of Mpumalanga have been used as taxis or rented out for weddings and funerals that the transport department announced last week it was opening a toll-free number for reports of vehicle abuse. A similar anti-corruption number is operating in Northern Province.
The independent Special Investigating Unit, created in 1996 to counter fraud, corruption and maladministration, is working on 90,000 cases involving almost $1.5 billion in state assets.
This year the unit has recovered or prevented the loss of goods or cash worth $115 million, $15 million more than the government's entire anti-corruption budget of $100 million.
Among the cases already solved: the theft of a blank voucher from the Department of Justice in the province of Mpumalanga, which was cashed for $750,000; the acquisition of a house, airplane and Mercedes-Benz automobile by two trustees of a charitable feeding program; a $110,000 fraudulent payment for machinery hired by the Durban City Council; the theft of 1,000 checks from the Eastern Cape Department of Education, with $13,000 recovered but more than $220,000 still missing; disbursement of almost $2 million from a liquidated state corporation to pay for houses, cars and school fees for former employees; and the recovery of 372 state-owned vehicles that were not returned after being sent for repairs in KwaZulu / Natal.
"We cannot allow a handful of greedy persons to plunder the state coffers when such money can be used for the upliftment of previously disadvantaged communities," Judge Willem H. Heath, head of the Special Investigations Unit, recently told the Institute for Security Studies, noting that donations from overseas as well state money for social programs had been filched.
The cost of corruption, he said, must be counted not only in lost cash and the suffering inflicted on the needy, but also in the diminished credibility of the country abroad.
Of 52 countries listed in the 1997 index of perceived corruption produced by Transparency International, an activist group for open government, South Africa ranked worse than 31 others.
Earlier this year, the International Finance Corporation, the private investment arm of the World Bank, identified corruption as the most serious government-related constraint on investment in South Africa.
"The plans for South Africa to be seen as the powerhouse of Africa are slowly fading," Heath told the Security Studies Institute. "On the one hand we have the resources, the skills, the manpower and the ingenuity to become the leader on the African continent.
"However, on the other hand, we are faced with a problem that has plagued Africa for decades -- corruption, maladministration and fraud."
This theme was taken up by Daley, here earlier this month on a four-nation tour to boost U.S. investment in Africa.
He noted that while South Africa was the United State's most important trading partner on the continent, it ranked only 33rd globally. Had U.S. trade with Africa grown in line with other developing countries it would have increased by 50 percent more.
African leaders, he said, needed to ask themselves: What will it take to attract more trade and investment?
Pub Date: 12/15/98