SA-US Relations: Lady R crisis looms amidst complex standoff, what do we really want? Katzenellenbogen

The diplomatic ties between South Africa and the United States have plunged into a state of crisis, leaving both nations at an impasse with no clear resolution in sight following the ‘Lady R’ scandal with accusations of the country supplying arms to Russia. South Africa’s increasing alignment with Russia following the Ukrainian invasion has deeply displeased Western countries. The repercussions of this strained relationship pose a significant threat to South Africa, as the risk of growing isolation from key investors and trading partners looms large, leading the country down a perilous path towards economic disaster. Jonathan Katzenellenbogen analyses the situation in the below article.

The Lady R: What do we really want?

By Jonathan Katzenellenbogen*

South Africa’s relations with the US are in a crisis, and there is no clear path out of the mess. South Africa’s increasing lean towards Russia since the invasion of Ukraine has infuriated the West.

The threat to us is that if matters are not in some way resolved, South Africa could end up increasingly isolated from key investors and trading partners. This would be a fast path to economic disaster.

Should matters between the US and South Africa seriously deteriorate and sanctions be imposed, the rand would steeply depreciate, access to overseas capital would be severely restricted and we might not be able to obtain critical goods and spare parts. That is not an immediate threat, but we could be headed that way. 

The US and SA have had talks about the Lady R incident and our relations with Russia since February, and clearly Washington has not been satisfied with the lack of progress. So, the US Ambassador Reuben Brigety went public. He said he “bet his life” that weapons were loaded onto Lady R, the Russian ship that visited Simonstown naval base last year. This, he said, meant South Africa could not claim to be non-aligned.

What the Ambassador did last week was to fire across South Africa’s bow to try to prevent us from taking additional moves into the Russian camp.

One way to look at the options for SA and the US in this stand-off is to use the list, with a slight change, that President Richard Nixon used to clarify his thoughts ahead of his visit to China in 1972, the first ever by a US President. On his flight to China Nixon wrote down three headings: “What they want”, “What we want” and “What we both want”.

What does the US want and not want, from South Africa?

Read more: South Africa is playing with fire and putting relations with Western nations at risk – Centre for Risk Analysis Chris Hattingh

The US would prefer that countries align themselves with the West, but fully realises that many will seek a neutral posture on the Russian invasion of Ukraine.

Washington has good relations with India, which follows its own path, although it’s a member of the Brazil, Russia, India, China, South Africa grouping, and a substantial oil and weapons importer from Russia. India’s non-alignment is well established and credible. It buys large amounts of Russian oil and gas, and it depends heavily on Russian-designed weapons. It has tensions with Beijing over a border dispute and is worried about China’s rise in Asia.   India’s non-alignment is also supported by its participation in the Quadrilateral Security Dialogue along with the US, Australia, New Zealand, and Japan.

What the US probably wants is for South Africa to have a foreign policy of credible non-alignment, that is broadly modelled on the Indian example. It certainly does not want to see South Africa voting to abstain in UN votes to condemn Russia. Even India and China voted to condemn Russian aggression in Ukraine in a recent General Assembly vote. South Africa’s abstention on this vote screamed open support for Russia.

Washington is worried that with South Africa’s help, Beijing and Moscow will make strong diplomatic and economic gains across the continent. They are also worried about the growing Wagner group presence on the continent and the Chinese naval presence in the South Atlantic.

Read more: Cyril’s Rubicon? RW Johnson on arms-to-Russia torpedo for SA’s motor industry, AGOA, ARV supplies.

More immediately, the US would look with great alarm if Russian President Vladimir Putin does indeed visit South Africa to attend the BRICS summit in Durban in August. And it does not want a Chinese naval task force to dock in Simonstown, although a French naval vessel will visit soon. 

And the US does want to be recognised as a substantial investor, trade partner, and donor, and not get slammed by the ANC as an aggressive imperial power.

The US would certainly not want to overplay its hand and push South Africa into the Cuba, Iran, Venezuela, Syria category.

What does South Africa want and not want from the US?

This could be the core of the problem. There are signs of deep division within the government and ANC on what we actually want from the US relationship.

The Finance Minister, Enoch Godongwana, is worried about where we are headed on this.  If there were sanctions, there would be a “massive” impact, he said last week. Among the realists, there are concerns about the possible ending of trade benefits under the Africa Growth and Opportunity Act, AGOA, and maybe a cut in US financing of HIV and AIDS programmes.

But amidst the chaos in the Ramaphosa administration, with key advisors departing, there is a danger that more cautious voices are not being fully heard.

Read more: “Lifeless” Ramaphosa doesn’t have it in him to last a second term – Sam Mkokeli

The dominant view from the ANC and Pretoria might be that South Africa must find an alternative to the Western pole in the global order. This leaning towards China and Russia would also mean reduced international demands for transparency and sound governance. 

The view that BRICS provides this option is influenced by talk of an alternative reserve currency to the US dollar and the prospects of a membership expansion. But realistically the US dollar is not about to be edged out as the dominant global reserve currency, and a BRICS enlargement will make it more difficult for the group to reach common positions. 

A sign that there are divisions over what South Africa may or may not want was the quote of an unidentified senior SA government official in the Sunday Times over the weekend. The official told the paper that the US needs South Africa a lot more than we need it. ‘The impression they (the US) are trying to create that we need AGOA at all costs is bulls**t. [Rather], they need us because they can’t operate in any other African country without operating from SA.’

That reflects wishful thinking rather than reality. US companies have long operated in oil-producing countries and through much of the continent without relying on South Africa. Spare parts for our planes and machinery and the ingredients that go into pharmaceuticals come largely from the US, Germany, and Japan, and increasingly India. Our funding comes heavily from the West. 

But does South Africa want a way out of the spat? There is no sign of an early resolution. Earlier this week a delegation of South African army generals was on a visit to Moscow.

What do the US and South Africa want and do not want?

 It is in the interest of neither country to push the row too far. The US would lose a partner on the continent, and South Africa would have a troubled economic and political time, having chosen to sit on the side of Russia and China. The rewards could not possibly match those from the US and Europe.

Depending on what the retired investigating judge finds, South Africa could admit that arms were loaded onto the Lady R, but this was a rogue operation. What South Africa certainly does not want in the present crisis is for the US to present in public the hard evidence it says it has.

No back-down is required by South Africa, just a more subtle and less one- sided diplomatic game to uphold our interests. 

*Jonathan Katzenellenbogen is a Johannesburg-based freelance financial journalist. His articles have appeared on DefenceWeb, Politicsweb, as well as in a number of overseas publications. Jonathan has also worked on Business Day and as a TV and radio reporter and newsreader.

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The views of the writer are not necessarily the views of the Daily Friend, the IRR or BizNews.

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