So what? Well, it all relates to payments the SEC said violated the Foreign Corrupt Practices Act; payments that were made to Chancellor House Holdings in South Africa. A stake was also sold to the same company which, the SEC said, was a sweetener for the ruling ANC in order for Hitachi to bargain for Eskom contracts.
The DA was first out of the blocks, saying it would lay charges against Chancellor House and would ask Public Protector Thuli Madonsela to investigate the matter. Analysts and commentators are having a field day and the average South African is left wondering just how big this next corruption scandal will get.
Then the ANC responded, saying it knew nothing of the payments to Chancellor House – which, the SEC said, were accounted for fraudulently in Hitachi documents – and that it was in no way involved in any form of corruption related to the Medupi and Kusile power stations. Hitachi Power Africa claims it had no knowledge Chancellor House was a funding vehicle for the ANC and that it has no idea about the settlement paid by the parent company.
If no one knows anything, it still won’t blow over. Let’s spell it out. Eskom is a state-owned enterprise which has a monopoly over SA’s constrained power generation, holding consumers hostage with the ever-present threat of power cuts. The state, which owns Eskom, is run by the ANC. The ANC has made many headlines in the past for how it may or may not benefit unfairly from its funding arm, Chancellor House which, until recently, owned a sizeable BEE stake in Hitachi Power Africa.
We have learnt Hitachi paid what the SEC calls illegal sums to Chancellor House. Eskom gave the contract to Hitachi to supply the boilers for two new power plants the country so desperately needs. There are too many questions that need answers for this to quickly blow over.
Hopefully, this time, when the truth comes out – and it always does – SA will be in a stronger position to fend off any repeats when it comes to the planned nuclear contracts, which would probably make the boilers seem like small fry.