South African President Cyril Ramaphosa has until June 21 to answer anti-graft ombudsman questions after being implicated in a probe into a donation his campaign received from a company linked to a bribes scandal. The rand fell.
Ramaphosa received notification about the preliminary outcome of the investigation, which will be finalised once he has responded, Busisiwe Mkhwebane said in a letter to Mmusi Maimane, the leader of the main opposition Democratic Alliance, which requested the probe. She has yet to decide whether to agree to a request by the president to question Maimane and other witnesses.
Johannesburg’s Sunday Independent newspaper reported that Mkhwebane had found that Ramaphosa violated the constitution and may have been party to money laundering when his campaign to win control of the ruling party accepted a donation from services company Bosasa.
The company had business dealings with Ramaphosa’s son and was implicated during a judicial probe of paying bribes to some cabinet ministers and senior government officials to win state contracts.
An already bad day for the rand got even worse following the release of Mkhwebane’s letter. The currency snapped its three-day winning streak, dropping as much as 1.2 percent against the dollar.
“It could be a source of uncertainty for the market and could also potentially slow down or at least distract President Ramaphosa from focussing on the implementation of economic reforms,” said Piotr Matys, a currency strategist at Rabobank in London.
Ramaphosa denied receiving money from Bosasa but backtracked a few days later, telling lawmakers he was unaware of the $33,832 payment, which would be returned.
South Africa’s Presidency said Ramaphosa will fully co-operate with the investigation to ensure the “matter is speedily brought to conclusion.”
“This is an embarrassing situation for Ramaphosa,” said Melanie Verwoerd, an independent political analyst.
“The fact that the Public Protector’s deadline is one day after the president is due to deliver his state-of-the-nation address to Parliament puts additional political pressure on him.”
An adverse finding by the ombudsman would be a blow to the image of Ramaphosa, who has pledged to clean up government after his predecessor Jacob Zuma’s scandal-tainted nine-year presidency. It’s unlikely to put his leadership at risk.
“I think if there is going to be any negative finding it is going to be of a technical nature,” Lawson Naidoo, executive secretary of the Council for the Advancement of the South African Constitution, said by phone. “From what is in the public domain, I don’t think it is a major issue of any sort.”