How Corrupt Is South Africa?

South African president Jacob Zuma is accused by his critics of being among the most corrupt public officials in the world. His country, meanwhile, has one of the planet's worst economies, with more than a quarter of the population unemployed. Is there a connection?

Almost certainly, as Jules Suzdaltsev explains in this Seeker Daily report.

Zuma's personal spending alone has put a dent in South Africa's economy -- no joke. Amid soaring public debt and harsh austerity measures, Zuma has spent more than $20 million in state funds on upgrades for his home, including a pool and amphitheater. In May, a parliamentary inquiry revealed the government had spent upwards of $500,000 on Audi, Range Rovers and other luxury vehicles for Zuma's four wives.

Zuma has also been accused of indulging in a form of corruption known as tenderpreneurship, in which public officials uses their status to profit from inflated contracts, called tenders. Zuma and his financial adviser were implicated in one such recent scandal, where they were accused of receiving kickbacks from a multi-billion dollar arms deal.

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The adviser was eventually found guilty of fraud and corruption, but the charges against Zuma -- more than 700 charges, actually -- were dropped. Economists say the practice of tenderpreneurship is so prevalent in South Africa that it's stifling development across all industries and scaring away foreign investors.

Corruption in the private sector is also draining funds from state coffers. It's an open secret in South Africa that companies are abusing the Broad Based Black Economic Empowerment Act, or BEE, which was created as direct response to nearly half a century of Apartheid policies. The law requires businesses to maintain a diverse workforce in order to qualify for public benefits and contracts.

But companies are regularly indulging in a form of corruption called "fronting," in which most white-owned businesses misrepresent themselves as racially diverse to pocket the public money.

Although South Africa has specific anti-corruption laws on the books, malfeasance is famously difficult to root out, especially when it involves high-ranking officials. As president, Zuma's rank is as high as it gets. In the short term, at least, change is going to be difficult in South Africa.

Learn More:

New York Times: Jacob Zuma Beats Back Impeachment Drive in South Africa

BBC: SA Judge finds Jacob Zuma should face corruption charges

News24: Uncertainty rules in SA, says Nomura economist

The Economist: Fool's gold: Black economic empowerment has not worked well. Nor will it end soon