Named: Van Rooyen’s two Gupta “advisors” who almost hijacked SA Treasury

The day after the shock of respected Finance Minister Nhlanhla Nene being replaced by an unknown backbencher, David van Rooyen arrived at National Treasury with his two until now unnamed “advisors.” In this article republished with its permission, London-based Africa Confidential names the duo as “Gupta allies” Mohamed Bobat and Ian Whitley and explains the context in graphic detail. Their arrival so shook the Treasury that its Director General threatened to resign and his staff immediately dubbed the event “9/12” – a reference to the US’s disastrous “9/11” of 2001. Former Finance Minister Trevor Manuel was so incensed that he wrote an open letter that was highly critical of President Jacob Zuma, Van Rooyen and the dark forces manipulating them for publication in City Press. After Zuma’s December 9 shock (“9/12”) decision, the rand plummeted, financial shares crashed and bond yields surged. After wiping R500bn off the value of South African assets, Zuma was forced into reversing his appointment, replacing him with Pravin Gordhan, the man he had fired a year and a half earlier. Here’s the fascinating inside story from Africa Confidential, the subscription-only service which have been covering the continent for more than half a century. – Alec Hogg

From Africa Confidential*

Delivering the State of the Nation address at the opening of what promises to be the South African Parliament’s most turbulent year, President Jacob Zuma announced a series of measures to shore up the country’s ailing economy, including cutting government expenditure, revamping the management of state-owned enterprises and partnering with the private sector to promote domestic and foreign investment.

David van Rooyen, South Africa's incoming finance minister, pauses during his swearing in ceremony at the Union Buildings in Pretoria, South Africa, on Thursday, Dec. 10, 2015. The rand fell for a sixth day in the longest streak of losses since November 2013, stocks slid and bond prices tumbled the most on record after South African President Jacob Zuma fired Finance Minister Nhlanhla Nene and replaced him with a little-known lawmaker. Photographer: Waldo Swiegers/Bloomberg
File photo: David van Rooyen, South Africa’s then incoming finance minister, pauses during his swearing in ceremony at the Union Buildings in Pretoria, South Africa, on Thursday, Dec. 10, 2015. The rand fell for a sixth day in the longest streak of losses since November 2013, stocks slid and bond prices tumbled the most on record after South African President Jacob Zuma fired Finance Minister Nhlanhla Nene and replaced him with a little-known lawmaker. Van Rooyen was then replaced by Pravin Gordhan. Photographer: Waldo Swiegers/Bloomberg

The measures are high on the wish list of a formerly disengaged business community which was shocked into action by Zuma’s disastrous sacking of Finance Minister Nhlanhla Nene on 9 December and the crash in share prices and the value of the rand that followed. The dismissal of Nene turned out to be the latest in a series of cabinet appointments made to circumvent resistance to the deal Zuma struck with Russia’s President Vladimir Putin last year to build nuclear power plants in South Africa. Successive Ministers of Finance and of Energy who voiced their opposition to the deal over its enormous cost were removed from office.

The main beneficiaries of the nuclear deal would have included the controversial Gupta family – three Indian brothers who have become massive beneficiaries of Zuma’s patronage. The Guptas influenced Zuma to appoint the previously unknown David ‘Des’ van Rooyen as Finance Minister, it is now generally accepted. Their intention was to secure uranium contracts for the nuclear plants in the same way they have for the coal and arms sector, according to the local press.

Another part of the strategy was to place two Gupta allies, whom Africa Confidential is able to name as Mohamed Bobat and Ian Whitley, as advisors to Van Rooyen at the Treasury. Whitley is a former head of small and medium enterprises at African Bank. When Van Rooyen was replaced at the Treasury, the two men went with him to his new portfolio of Local Government and Traditional Affairs, and appeared with him when he was sworn in on 10 December.

Bobat and Whitley, who have associations with the Guptas and their businesses, visited the Treasury before Van Rooyen’s appointment and told officials there that they would be able to sign expenditure and other authorisations on behalf of the new minister but otherwise there would be no changes. Senior Treasury officials led by Director General Lungisa Fuzile were so appalled that they threatened to resign unless Van Rooyen’s appointment was reversed.

Then there is the strange case of Van Rooyen’s childhood friend, Gaddafi Rabotapi, who, former Finance Minister Trevor Manuel pointed out in an angry open letter to Minister Lindiwe Zulu on 20 December, had known about Van Rooyen’s appointment a full month before it was announced by Zuma. Manuel also said that the proper procedures had not been followed in the appointment of Bobat and Whitley, whom he did not name in the letter, nor had it been established that they had the requisite skills for either portfolio.

Following the firing of Nene in December, it was the business leaders acting in concert with moderates in the African National Congress who forced Zuma at political gunpoint to reverse his appointment of a stooge as finance minister and re-instate the highly-respected Pravin Gordhan. Further details have now emerged about the meetings in which Zuma fought tooth and nail not to give in. At one of them Patrice Motsepe, the billionaire benefactor of the governing party, told Zuma to be quiet and listen to the business leaders. Zuma’s former wife, Nkosazana Dlamini-Zuma, the main rival of Deputy President Cyril Ramaphosa in the succession stakes, expressed shock that the President could be addressed in such a way.

Intense and high-level meetings between government and business followed in rapid succession at the World Economic Forum in Davos, Switzerland, in January. There was a follow-up meeting between Gordhan and Zuma and 60 captains of industry and finance on 29 January. Zuma met over 100 top business chief executive officers on 10 February in Cape Town on the eve of the State of The Nation speech.

At the 29 January meeting, hosted by Old Mutual/Nedbank and chaired by Gordhan, emergency working groups were set up to report within four days to: promote economic growth, take steps to stimulate foreign and local investment, revamp the management of state-owned enterprises, and take urgent steps to avoid junk status for investment. Gordhan and his officials then processed the recommendations in record time and they were fed in as the core content of Zuma’s State of The Nation speech. It was the best coordinated collaboration between government and business in 22 years of democracy, insiders said. The dramatic sequence of events has put Gordhan in the driving seat of government and all but indemnified him against dismissal.

At the Mining Indaba in Cape Town in the days before the State of the Nation speech, Zuma would have felt additional pressure from mining luminaries who shared the views of the CEOs who were directly in touch with the President, such as Simanye’s Neal Froneman, Pallinghurst’s Brian Gilbertson, Adam Fleming, Clifford Elphick of Gem Diamonds, Africa Invest’s Rob Hersov, hedge fund manager Julian Schrager, Lord Robin Renwick of Hannam and Partners and Ivanhoe’s Robert Friedland. Global players who also added to the pressure on Zuma included the Indian steel tycoon Lakshmi Mittal, who was contemplating a major investment when news of Nene’s dismissal broke.

President Xi Jinping of China is also understood to have delivered a message via diplomatic backchannels to protect China’s 20% state in Standard Bank. The country’s two richest families – the Oppenheimers (Nicky and his son Jonathan) who recently sold the diamond giant De Beers to the ailing Anglo American, and the Ruperts (Johann) who command a huge international empire – kept a low profile through the affair. The events also revealed that the two more recent plutocratic dynasties – the Motsepes and the Guptas – are increasingly at daggers drawn as they vie for influence over the ANC.

Deputy President Ramaphosa is backed for the succession by the Motsepes. He is married to Patrice Motsepe’s sister Tshepo but is trailing Zuma’s former wife, Nkosazana Dlamini-Zuma, in the succession stakes. She is backed by her former husband and the Guptas. Motsepe’s other sister, Bridgette, a billionaire in her own right, is married to Minister in the Presidency Jeff Radebe, a Ramaphosa ally.

At yesterday’s shambolic opening of Parliament, the Economic Freedom Fighters walked out of Parliament in their signature red overalls chanting ‘Zupta must fall’ – a cryptic reference to the Gupta family and Zuma. Mosiuoa Lekota, Leader of the Congress of the People, an earlier breakaway from the ANC, was the first to lead his party in a parliamentary walk-out proclaiming that he was not prepared to listen to a man who had violated the constitution and was unfit to lead the country.

On the eve of the opening of Parliament, the two main opposition parties which stand to take votes from the ANC in the coming local government poll – probably on 3 August – brought charges against Zuma in the country’s highest court for violations of the constitution. The Democratic Alliance and Julius Malema‘s EFF joined forces to have the President declared unfit for office over his refusal to abide by the Public Protector’s binding ruling that he should reimburse the state for the multi-million upgrades to his retirement compound.

A finding against the President would create a constitutional crisis as Parliament, in which the ANC has a clear majority, would be in conflict with the Constitutional Court, which is the supreme constitutional authority. A finding by the court that Zuma was guilty of a serious violation of the constitution would provide grounds for his impeachment.

By offering to repay an undisclosed sum on the eve of the court hearing, Zuma faced further accusations that he had breached his oath of office by consistently lying to the country about his role in the use of taxpayers’ money in the financing of his Nkandla homestead.

The formidable potential of civil society has been re-activated in recent weeks and moves are now afoot to launch a major national organisation in March to hold government to account and monitor its progress.

The five-year project will be headed by church leaders by the Anglican Archbishop of Cape Town, the Right Reverend Thabo Makgoba and will include business leaders, academics, professional and community organisations and non-governmental organisations.

Comments on Van Rooyen's advisors

Some of the comments posted on Alec Hogg’s Facebook page.

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  • Stevo Jones

    The NPA under jiba is all zuma, all of the time. Wanna call the Hawks? Sorry they are zuma, all the time too. How about the Police? Sorry, zuma all the time as well. The army? I wouldn’t want to bet on what would happen there…

  • Nofearorfavor

    Thanks for your response. I asked because the people of SA, in accordance with the Constitution, are within their rights to take legal action against the president. I believe we are a representative democracy, but this should not impede the people’s rights to prosecute a president who seems to have no respect for and is a law unto himself. Sort of a case of the People versus Zuma.

  • peterq

    African leaders have always been a curse on their own people. Yes, the Guptas tell Zuma what to do.

  • Nofearorfavor

    Government has never cared for the real black people of SA, only their families and cronies? The only time the care for ordinary blacks is when elections are coming up — then they’re over them like a rash with yet more false promises.

  • Nofearorfavor

    How can the president simply sign deals which could critically impact SA’s future, without these deals including a proviso, that the people of South Africa would have to approve it? Surely that’s unconstitutional? I read today that the government passed a bill allowing it to nationalise all property — including private property — are we seeing police state developments in our country?

  • Macafrican

    “When Van Rooyen was replaced at the Treasury, the two men went with him to his new portfolio of Local Government and Traditional Affairs, and appeared with him when he was sworn in on 10 December”

    Can the press obtain written confirmation that the two men are now employed at Local Government & Traditional Affairs, in what capacities and at what package, plus how these appointments were made by the department : as in vacancies described, advertised, candidates considered and interviewed, etc etc

  • Happy ol’ Git

    Exactly! So why the hell do you keep voting the ANC in? Are you all insane? The definition of insanity is to keep repeating an action, hoping for a different result!

  • John Dove

    Neither. Just Zuma. And themselves (the NEC).

  • New SA is dysfunctional !

    Only because zuma abused the power, but it’s slowly slowly being ground to a halt and I’m thinking there’s lots of very worried crony sycophants around at this point.

  • Dr Who

    But look at Shaik, he’s been on his death bed since 2009 although this hasn’t stopped him from swinging a few clubs on the golf course in the course of his dying paroxysms. Pretty much a similar scenario for JZ I’m afraid…

  • New SA is dysfunctional !

    That’s what a few other former African presidents also thought but now for eg Nigeria is taking steps and are inmthe process of prosecuting one of their own former president for much the same!

  • Dr Who

    Perhaps I used a rather optimistic word, probably prosecution would be the right word. Given his influence even after his departure and likely conviction I very much doubt he will sample jail fare – it’s beneath his lordship now…

  • Garfy542001

    Unfortunatly there needs to be a majority vote so the regime made sure it can never pass.
    I cannot believe the only was to remove this person is by his own organization only.

  • The impeachment question is confusing. Is the Concourt competent to pass such a judgement, or does it require a majority vote in parliament? If the latter, it needs no genius to predict the outcome, whichever way the evidence may point.

  • The charge of “treason” lost most of its popular appeal in the 1960s when the then NP government tried it out for size (and lost the case).

  • “Legally brought to book” is a phrase that slips lightly off the tongue, but on examination, it raises more questions than answers. As just a parallel, the facts in the “Oscar” case seem clear enough, but the process of legal hair-splitting about precisely what charge to convict him on are still undecided to this day.
    At what level should “hijacking the treasury” be prosecuted?

  • New SA is dysfunctional !

    Not so I think, they’re just being shackled by ANC political infighting but the time will come sooner than later when zuma’s power play grinds to a deafening halt, and it’s happening I think now,

  • Lawrence Dahl

    I don’t believe that Motsepe told Zuma to be quiet and listen. Sounds like after-the-fact spin by people in the Motsepe camp (and there is a lot about Motsepe in the article). Nice try though…

  • New SA is dysfunctional !

    Yep but the Guptas have now also captured Denel

  • New SA is dysfunctional !

    I Wonder If he’s going to like jail food though

  • New SA is dysfunctional !

    Yes you do need to blame yourselves, democracy isn’t about stupidity and blinded loyalty it’s about keeping policitians who are elected on their toes and doing what us the voters want,

  • Frederick Caiger

    It’s Africa folks.What did you really expect?This is normal for African politicians.Just look at the Congo ,Zimbabwe ,Mozambique ,Angola etc etc.So you get rid of Zuma, then what? The next black leader with sticky fingers ,and ridiculous appointments of his buddies that couldn’t run a paid public toilet.Good luck!

  • sunil shah

    How much more evidence do we need that Zuma is not fit for any political role, least of all the presidency!! And every person tarred by the Gupta brush should learn it’s political suicide to be associated with them. Let Van Rooyen, Whitely and Bobat know this is the end of their political life. And maybe others will be deterred.

  • General_Whoflungpoo

    Because ANC members will still stand up and support the corruption during the SONA.

    When those types are gone we can progress.

  • John Dove

    In the world Zuma and many of his patrons hold so dear, they would be facing a firing squad or banishment to the gulags for crimes against the state.

  • Dr Who

    Big business, big influence. JZ is seeking to look after his own, he is no fool and is bent on securing as much annuity income during the earlier of his demise or end of term to ensure that he, his family and friends have the resources to fight in the courts against his incarceration when he eventually relinquishes the levers of state power.

  • Frank Payne

    This country is up for grabs by a bunch of individuals, totally focussed on power and self enrichment to the detriment of a whole country. South Africans of all persuasions need to wake up to what is going on and bring about change at the ballot box before even this avenue is blocked. That anyone can get away with the goings on that have taken place here is disgraceful and an indictment against every single person who by their decision to avoid facing up to this scourge, is allowing it to happen. The time is certainly overdue for there to be concerted public demand for accountability for these actions and to ensure that the perpetrators are brought to book. It requires courage from all civic organisations, the judiciary, police, business and civil associations, especially politicians and crucially each individual, to challenge what is happening here.

  • New SA is dysfunctional !

    I’ve asked the very same question myself before, but the ANC under Zuma is only after one thing and that’s their own personal enrichment / and $&$ the poor.

  • New SA is dysfunctional !

    It’s high time the South Aftican serious fraud unit should be intervening and I agree with Peterq treason charges would be a bonus for any and all those involved.

  • New SA is dysfunctional !

    The Gupta mafia must leave South Africa. The EFF is well within their rights to demand that the Gupta family in its entirety must go and go immediately .

  • Garfy542001

    This must be enough to start impeachment proceedings?

  • peterq

    Should be treason, giving your country and people away like you own them.
    Who is the ANC protecting, the Guptas or the black people of South Africa?

  • SportingRSA

    Such an attempt @ highjacking the Treasury is a serious attack on our democratic processes. Why are such actions not being legally brought to book?