State capture: Zuma, the Guptas, and the sale of South Africa (2023)

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State capture: Zuma, the Guptas, and the sale of South Africa (1)Image source, Getty Images

By Neil Arun

BBC News

South Africa's former President, Jacob Zuma, is giving evidence this week at a commission set up to investigate corruption allegations during his time in office.

The inquiry takes its name from an academic term, "state capture", that has become a buzzword - shorthand for the multiple scandals that plagued the Zuma administration and eventually brought it down.

So what exactly is state capture?

State capture describes a form of corruption in which businesses and politicians conspire to influence a country's decision-making process to advance their own interests. As most democracies have laws to make sure this does not happen, state capture also involves weakening those laws, and neutralising any agencies that enforce them.

Image source, AFP

"State capture is not just about biasing public policy so that it systematically favours some corporations over others," Abby Innes, assistant professor of political economy at the London School of Economics, told the BBC. "It's also about strategically weakening that part of the state's law enforcement mechanism that might crack down on corruption."

"Classic corruption involves individual politicians taking side-payments for preferential treatment in outsourcing contracts, a small deal here, a license payment there," Dr Innes said.

"Full-on state capture is where corporations can influence the nature of the legislative process, and political actors allow them to do so for private gain. The whole policy-making structure of the state becomes commodified - something that politicians are willing to sell."

If traditional corruption means slipping a bribe to every police officer that catches you speeding, state capture means paying to have your car fitted with police lights so that no officer dare stop you from speeding again. Rather than paying to get away with breaking the law, you pay to make the law work for you.

(Video) 🇿🇦 South Africa Corruption Inc. | People and Power

Where did the term come from?

The concept of state capture was defined in a 2003 World Bank report on corruption in eastern Europe and central Asia.

Joel Hellman, a report co-author who now serves as dean of the School of Foreign Service at Georgetown University, said a new term was needed to describe the extraordinary tactics that certain firms, owned by oligarchs, were using to maintain their dominance of the market.

"We noticed that these firms were active players not just in lobbying, which goes on everywhere, but also in using private payments to public officials to shape the laws of institutions in their favour," Mr Hellman told the BBC.

State capture theory initially helped explain the oligarchs' hold over the fragile democracies of the former Soviet bloc. Today, the concept is applied more broadly for a range of dubious dealings between corporations and governments around the world.

How did state capture operate in South Africa?

Many of the revelations from the inquiry concern the relationship between two families - the Zumas, centred on the former president, and the Guptas, three Indian-born brothers who moved to South Africa after the fall of apartheid.

The two families became so closely linked that a joint term was coined for them - the "Zuptas".

Image source, AFP

All parties have denied the allegations against them, describing them as politically motivated.

The Guptas owned a portfolio of companies that enjoyed lucrative contracts with South African government departments and state-owned conglomerates. They also employed several Zuma family members - including the president's son, Duduzane - in senior positions.

According to testimony heard at the inquiry, the Guptas went to great lengths to influence their most important client, the South African state.

Public officials responsible for various state bodies say they were directly instructed by the Guptas to take decisions that would advance the brothers' business interests.

It is alleged that compliance was rewarded with money and promotion, while disobedience was punished with dismissal.

More about the Guptas in South Africa:

The public bodies that are said to have been "captured" in this fashion included the ministries of finance, natural resources and public enterprise, as well as the government agencies responsible for tax collection and communications, the state broadcaster SABC, the national carrier, South African Airways, the state-owned rail-freight operator Transnet and the energy giant Eskom, one of the world's largest utility companies.

The responsibility for promoting and dismissing public officials lay with Mr Zuma. According to David Lewis, executive director of Corruption Watch, a Johannesburg-based NGO that investigated the Guptas, the president's powers of appointment were key to the success of the alleged conspiracy. As well as ministers, the South African president has the right to appoint the boards of directors of state-owned enterprises and - critically - the heads of law enforcement agencies.

Mr Zuma could do as he pleased, Mr Lewis told the BBC, "as long as he ensured who was appointed the head of the police, and the head of the anti-corruption agency of the police".

What was the impact of state capture in South Africa?

The allegations eventually brought the Zuma presidency to a premature end last year and prompted the Guptas to leave South Africa.

They also damaged the reputations of various illustrious firms that had done business with the Guptas.

Ethical lapses were highlighted at the global accounting giant KPMG, management consultants McKinsey and Bain and Co, and the German IT company, SAP. Bell Pottinger, a London-based PR firm with a history of representing repressive governments, was dealt a fatal blow, closing down over its dealings with the Guptas.

Image source, Gallo Images

State capture has blown a hole through the public finances, disappearing tens of billions of dollars from Africa's most advanced economy. The scandal has also dealt a huge blow to the reputation of the African National Congress, the party that has governed South Africa for nearly 30 years. Many of Mr Zuma's colleagues in the party have, like him, been accused of corruption.

According to Dr Innes, the ultimate victim of state capture tends to be the political system that is corrupted by business interests. "Politics becomes the point of entry and exit into what is fundamentally a financial market for retaining control over the state and its assets," she said.

What can be learnt from the South African case?

The alleged conspiracy between the Zumas and the Guptas was eventually stopped by a combination of factors, including pressure from global financial markets that were alarmed by the hiring and firing of ministers in charge of the economy.

Mr Lewis argues that while the country had been let down by certain democratic institutions, such as its prosecutorial and regulatory agencies, it was rescued by others.

These included the independent media, the courts and civil society organisations - all of which had honed their skills fighting apartheid. South Africans, he said, belonged to a "young democracy with a very recent tradition of resistance to authoritarian rule. They don't take things lying down".

Mr Hellman, who testified at the inquiry, says South Africa's open discussion of the impact of state capture had set a positive example for other countries. However, he warned that there was also a risk that any such process ends up being used to settle political scores, rather than to address the "structural issues" that allowed the corruption to flourish.

(Video) South Africa: Who are the Guptas at the heart of Zuma's downfall?

Having left South Africa, the Guptas are now living in Dubai.

Jacob Zuma is currently on trial in a separate corruption case. In a 2007 TV interview, he denied that the state had been "captured".

"There is no parliament that is captured, there is no executive that is captured," he said. "State capture is political propaganda."

The interview was given to ANN7, a TV channel founded by the Gupta family. Its former editor told the state capture inquiry that Mr Zuma had been "very much involved in the running of the station".

More on this story

FAQs

What is the meaning of state capture in South Africa? ›

Defining state capture

State capture seeks to influence the formation of laws, in order to protect and promote influential actors and their interests. In this way it differs from most other forms of corruption which instead seek selective enforcement of already existing laws.

What happened between Zuma and the Guptas? ›

The brothers were reportedly arrested in Dubai on 6 June 2022. Extradition talks took place between South Africa and United Arab Emirates. The family has been the focus of extensive international scrutiny and caused much political controversy as result of their close ties to Jacob Zuma before and during his presidency.

What is the purpose of the state capture inquiry? ›

The Judicial Commission of Inquiry into Allegations of State Capture, Corruption and Fraud in the Public Sector including Organs of State, better known as the Zondo Commission or State Capture Commission, is a public inquiry established in January 2018 by former President Jacob Zuma to investigate allegations of state ...

What does capture mean in politics? ›

In politics, regulatory capture (also agency capture and client politics) is a form of corruption of authority that occurs when a political entity, policymaker, or regulator is co-opted to serve the commercial, ideological, or political interests of a minor constituency, such as a particular geographic area, industry, ...

What does Gupta mean? ›

Gupta (/ˈɡuːptə/) is a common surname or last name of Indian origin. It is based on the Sanskrit word गोप्तृ goptṛ, which means 'guardian' or 'protector'. According to historian R. C. Majumdar, the surname Gupta was adopted by several different communities in northern and eastern India at different times. Gupta.

When did looting happen in South Africa? ›

The unrest began in the province of KwaZulu-Natal on the evening of 9 July, and spread to the province of Gauteng on the evening of 11 July, and was the worst violence that South Africa had experienced since the end of Apartheid.
...
2021 South African unrest.
2021 South African Riots
Casualties
Death(s)354
Arrested5,500
11 more rows

Who were the Guptas and what helped them establish a successful empire? ›

The Guptas exploited the rich reserves of iron ore in South Bihar which made them rich. 3. They established empire close to Silk route which helped them in trading.

What was the reasons for the fall of Guptas? ›

Answer: The political factors for the downfall of the Gupta Empire were dynastic dissensions, taxes, foreign invasions, internal rebellions and decentralization.

Who attacked the Guptas? ›

The Huna People, also known as Huns, invaded Gupta territory and caused significant damage to the empire. The Gupta Empire ended in 550 CE, when it disintegrated into regional kingdoms after a series of weak rulers and invasions from the east, west, and north.

What is the role of commission of inquiry in South Africa? ›

A province may investigate, or appoint a commission of inquiry into, any complaints of police inefficiency or a breakdown in relations between the police and any community; and must make recommendations to the Cabinet member responsible for policing - Section 206(5)

Who was the chairman of the commission of inquiry? ›

Shah Commission was a commission of inquiry appointed by Government of India in 1977 to inquire into all the excesses committed in the Indian Emergency (1975 - 77). It was headed by Justice J.C. Shah, a former chief Justice of India.

Who appointed the Zondo Commission? ›

Ray Zondo
The Honourable Raymond Zondo
Chairperson of the Zondo Commission
In office 21 August 2018 – 1 January 2022
Appointed byPresident Jacob Zuma
Preceded byCommission established
34 more rows

What is a good sentence for the word capture? ›

Verb using traps to capture mice The city was captured by the Romans. She captured 60 percent of the vote in the last election. The company plans on capturing a larger segment of the market.

What is another meaning of capture? ›

Some common synonyms of capture are bag, catch, ensnare, entrap, snare, and trap. While all these words mean "to come to possess or control by or as if by seizing," capture suggests taking by overcoming resistance or difficulty.

What type of word is capture? ›

verb (used with object), cap·tured, cap·tur·ing. to take by force or stratagem; take prisoner; seize: The police captured the burglar.

Is Gupta a girl name? ›

Name Gupta is a Masculine (or Boy) name.

Is Gupta a male or female name? ›

Gupta - Girl's name meaning, origin, and popularity | BabyCenter.

What are the Gupta known for? ›

Definition. The Gupta Empire stretched across northern, central and parts of southern India between c. 320 and 550 CE. The period is noted for its achievements in the arts, architecture, sciences, religion, and philosophy.

What's the purpose of looting? ›

Looting is the act of stealing, or the taking of goods by force, typically in the midst of a military, political, or other social crisis, such as war, natural disasters (where law and civil enforcement are temporarily ineffective), or rioting.

What are the impact of looting? ›

The effect of the looting is evident on small and big businesses as well as the economy, increasing unemployment and making it difficult for businesses to recover from their losses. However, there are ripple effects which are not as clear. These include those on the health sector, and by extension the vaccine roll out.

How can we stop looting? ›

Let's take a closer look at five efficient ways to prevent looting at your business!
  1. Assess the Premises. ...
  2. Acquire Resources for Evidence or Discouragement. ...
  3. Beef Up Your Exterior Security. ...
  4. Consider Security Personnel. ...
  5. Know Your Protocol.
8 Feb 2021

What were the 5 achievements of the Gupta Empire? ›

Gupta had developed advancements in Science, Engineering, art, dialectics, laterature, logic, mathematics, astronomy, religion, and philosophy. The golden age brought more knowledge including architects making amazing temples and structures.

Who was the first known Gupta ruler? ›

Chandra Gupta I, king of India (reigned 320 to c. 330 ce) and founder of the Gupta empire.

What are the top 3 achievements of the Gupta Empire? ›

Among the products traditionally thought to be from the Gupta era were the decimal system of notation, the great Sanskrit epics, and Hindu art, along with contributions to the sciences of astronomy, mathematics, and metallurgy.

What are the main sources of Guptas? ›

There are plenty of source materials to reconstruct the history of the Gupta period. They include literary works, Inscriptions, Coins and Monuments. Literary sources: The Puranas like Vayu, Vishnu, Matsya, Bhagavata, Skanda and Markandeya throw light on the royal genealogy of Gupta kings.

How did the Guptas develop a successful economy? ›

Answer: The Gupta Empire's mainstay was agriculture. The Gupta economy thrived by concentrating on agriculture. The agricultural system was well developed during the Gupta period, and the Gupta emperors used scientific methods to increase agricultural production.

Why is the Gupta period known as the golden age? ›

The Gupta age in ancient India has been called the 'Golden Age of India' because of the many achievements in the field of arts, science, and literature that Indians made under the Guptas. The prosperity under the Guptas initiated a period of splendid accomplishments in arts and sciences.

Who is the last Gupta ruler? ›

Skandagupta, son and successor of Kumaragupta I is generally considered to be the last of the great Gupta rulers.

How did Gupta end? ›

The Gupta empire ended with the invasion of the White Huns, a nomadic tribe of people from central Asia, at the end of the fifth century CE. Until the sixteenth century, there was no unifying empire; regional political kingdoms ruled India.

Who won Guptas? ›

Skandagupta ascended the throne in year 136 of the Gupta era (c. 455-456 CE).

What type of income is commission? ›

Commission is what employees earn when they make a sale or accomplish some other goal. Commissions can be a percentage of a sale or a flat amount based on the sales volume. These types of payments are based on results. Sales positions, like car salesmen or real estate agents, commonly earn commissions.

What are the three roles of the commission? ›

requiring the discovery and production of any documents; receiving evidence on affidavits. requestioning any public record or copy thereof from any court or office. issuing commissions for the examination of witnesses and documents.

What are the 3 elements of inquiry? ›

Elements of Inquiry: Reflection, Critical Thinking, and Research.

How many members were there in commission of Enquiry? ›

The following elders of the jungle were appointed to sit in the Commission: (1) Mr Rhinoceros; (2) Mr Buffalo; (3) Mr Alligator; (4) The Rt Hon. Mr Fox to act as chairman; and (5) Mr Leopard to act as Secretary to the Commission.

What is commission of inquiry Act? ›

An Act to provide for the appointment of Commissions of Inquiry and for vesting such Commissions with certain powers. 1. Short title, extent and commencement. —(1) This Act may be called the Commissions of Inquiry Act, 1952.

What are the duties of the director general what is the procedure of inquiry under Sec 19? ›

Procedure for inquiry on complaints under section 19.-

The Director General shall, on receipt of direction under sub-section (1), submit a report on his findings within such period as may be specified by the Commission.

Who is the chief judge in SA? ›

Chief Justice Mogoeng Mogoeng is the fourth Chief Justice of the Republic of South Africa since the dawn of democracy.

Who is the chief of justice in South Africa? ›

President Ramaphosa appoints Justice Zondo as Chief Justice. President Cyril Ramaphosa has, in accordance with Section 174(3) of the Constitution, decided to appoint Deputy Chief Justice Raymond Zondo as the next Chief Justice of the Republic of South Africa with effect from 1 April 2022.

Who is the deputy chief justice of South Africa 2022? ›

President Cyril Ramaphosa has appointed Madam Justice Mandisa Muriel Lindelwa Maya, current President of the Supreme Court of Appeal, as Deputy Chief Justice of the Republic of South Africa with effect from 1 September 2022.

What is the base word of capture? ›

capture (n.)

"act of taking or seizing," 1540s, from French capture "a taking," from Latin captura "a taking" (especially of animals), from captus, past participle of capere "to take, hold, seize" (from PIE root *kap- "to grasp").

What is the past simple of capture? ›

past tense of capture is captured.

What is the meaning of capture the moment? ›

What Does it Mean to Capture the Moment? When we talk of capturing the moment in photography, we're really referencing the feeling, emotion, vibe or atmosphere or the photo. And that comes from more than just the subjects or the scenery, it comes from the photographer, too.

Who is a capturer? ›

Definitions of capturer. a person who captures and holds people or animals. synonyms: captor. Antonyms: liberator. someone who releases people from captivity or bondage.

What do you call people who capture? ›

captor Add to list Share. Someone who catches a person or animal and keeps them confined or imprisoned is a captor.

What is a capture photo? ›

a photograph; used especially when commenting on a photograph on social media: We are sharing this great capture of a rainbow over the city.

What is the opposite capture? ›

Escape means 'to break free' which is the opposite of capture.

Can I say capture a photo? ›

As a digital photo or digital video both use data thus they can indeed be described as being captured, but in everyday conversation no-one would say “I captured a photo”.

What is the meaning of nice capture? ›

So that's where the “nice capture” happens for me. A polite way of saying, I saw your photo. Thanks for the distinction between “look at this” and “look at me” it's something I want to work on.

What is the role of state security in South Africa? ›

The SA Yearbook, government's premier publication on what it is and does, has the SSA mandate as providing government with intelligence on domestic and foreign threats or potential threats to national stability, the Constitutional order and the safety and wellbeing of citizens.

What is behind the looting in South Africa? ›

At least 200 people have been killed and more than 3,000 arrested in widespread civil unrest in South Africa. Mass looting and violence were sparked after the imprisonment of former president Jacob Zuma on charges of contempt of court. But these protests go beyond politics—and they should be a warning to the world.

What did looting do in South Africa? ›

People across South Africa are surveying the damage caused by the politically triggered riots. The city of Durban has estimated over $1 billion in damages and lost goods, which, along with 129,000 jobs at risk, could amount to a $1.4 billion hit to the port city's gross domestic product.

How did looting affect South Africa? ›

Due to the destruction unleashed in July, consumers and businesses will be negatively affected for some time, which adversely affects spending behaviour. Both KwaZulu-Natal and Gauteng have suffered losses in consumption and the production of goods, both of which contribute directly to GDP.

Who is head of state security in South Africa? ›

Statement on appointment of State Security Agency Director- General. President Cyril Ramaphosa has appointed Ambassador Thembisile Majola as the new Director-General of the State Security Agency (SSA) with effect from 1 March 2022.

What is the role of the state in the economy of South Africa? ›

The South African government owned and managed almost 40 percent of all wealth-producing assets, including iron and steel works, weapons manufacturing facilities, and energy-producing resources. Government-owned corporations and parastatals were also vital to the services sector.

What are the main objectives of social security in South Africa? ›

South Africa's contributory and non-contributory social security mechanisms aim to alleviate poverty or provide temporary income support. The non-contributory components make up the greater part of the social security system.

How can we prevent looting? ›

Let's take a closer look at five efficient ways to prevent looting at your business!
  1. Assess the Premises. ...
  2. Acquire Resources for Evidence or Discouragement. ...
  3. Beef Up Your Exterior Security. ...
  4. Consider Security Personnel. ...
  5. Know Your Protocol.
8 Feb 2021

How did looting affect the economy? ›

The effect of the looting is evident on small and big businesses as well as the economy, increasing unemployment and making it difficult for businesses to recover from their losses. However, there are ripple effects which are not as clear. These include those on the health sector, and by extension the vaccine roll out.

Is looting a crime? ›

In Penal Code 463 PC, California law defines the crime of looting as taking advantage of a state of emergency to commit burglary, grand theft or petty theft. Looting can be charged as a misdemeanor or a felony and is punishable by up to 3 years in jail.

How many people died during looting in South Africa? ›

South Africa riots: At least 117 killed, over 2,000 arrested amid worst violence in decades. The chaos erupted following the imprisonment of former President Jacob Zuma. At least 72 people have been killed and 1,234 arrested after former South African President Jacob Zuma was imprisoned for alleged corruption.

How did looting affect the environment? ›

The waste resulting from the unrest included trash from looted goods as well as debris and chemical waste from damaged buildings and fires.

How did looting affect poverty? ›

The recent looting has not only caused more damage to the already vulnerable economy but has also led to food and fuel shortages, exacerbating poverty in affected areas.

How much did the looting cost in South Africa? ›

President Cyril Ramaphosa told the South African Human Rights Commission on Thursday that nearly two million people were left unemployed and more than R50-billion had been “wiped off the economy” due to the violent July 2021 unrest that brought KwaZulu-Natal and sections of Gauteng to a standstill in 2021.

How much money did South Africa lose during looting? ›

In total the looting cost 2.5 billion rand ($157.99 million) in stolen goods and damaged assets, with an accounting loss of around 650 million rand after insurance proceeds.

Videos

1. Howa on Gupta family selling its SA businesses
(SABC News)
2. Political Capital explores the Gupta business dealings in South Africa
(CNBCAfrica)
3. Gravitas: Years after Gupta corruption scandal, Ramaphosa cleans up his party
(WION)
4. State Capture Inquiry hears SABC archives sold to ANN7
(SABC News)
5. State Capture Report | How the Guptas captured Transnet
(eNCA)
6. Who are the Guptas of South Africa?
(TRT World)
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