South Africa: Bain, McKinsey… The role foreign firms played to aid the capture of state-owned firms

By Xolisa Phillip, in Johannesburg

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Posted on February 4, 2022 11:01

South Africa’s former President Zuma faces a state corruption inquiry, in Johannesburg
South African Deputy Chief Justice Raymond Zondo attends the Judicial Commission of Inquiry into Allegations of State Capture, where South Africa’s former president Jacob Zuma is summoned to face a state corruption inquiry, in Johannesburg, South Africa, February 15, 2021. REUTERS/Siphiwe Sibeko

The Commission of Inquiry led by Justice Raymond Zondo has concluded that state capture took hold in South Africa. The capture of key institutions and state-owned entities (SOEs) was enabled and facilitated by foreign firms, including Bain, McKinsey and the now-defunct Bell Pottinger, according to the commission report.

Between 2009 and 2017, a period referred to as the ‘Zuma years’, when Jacob Zuma was both the president of South Africa and the governing African National Congress (ANC), targets of state capture included the South African Revenue Service (SARS), South African Airways (SAA), Transnet, Eskom, Denel, among others.

In the wake of the release of the inquiry report, Karam Singh, the executive director of Corruption Watch, says: “I think what remains to be seen, which is of interest to us, is what would be the reaction now of the state in South Africa towards these firms. In some cases, there hasn’t been a proper accounting for the role that they played.”

“[…] Bain and McKinsey have, sort of, disavowed that they did anything wrong, although they’ve paid back the money. It becomes a bit of a cautionary tale of how we go forward,” Singh told The Africa Report in an interview on Thursday.

During the course of the inquiry, the commission heard testimonies from more than 300 witnesses over a period of 400 days.

The report contains damning testimony of Bain’s role in the capture of SARS, South Africa’s tax-collection agency, under the leadership of former commissioner Tom Moyane, through an organisational redesign.

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