How Nene thwarted Zuma's R30m plan to woo Al-Bashir
Then finance minister Nhlanhla Nene quashed Dudu Myeni’s bid to force SAA to fly an "unprofitable" route to Khartoum – at Jacob Zuma's behest.
Two days after Sudanese President Omar al-Bashir hastily left South Africa under the threat of arrest, SAA chairperson Dudu Myeni argued the national carrier should open a new route to his capital, Khartoum – an apparent show of respect by President Jacob Zuma for the wanted fugitive.
But then the finance minister at the time, Nhlanhla Nene, curtly told her he would not approve the plan. Four months later, following a different clash over a deal with Airbus, he was suddenly removed from his post, sending shockwaves through the currency market.
Correspondence seen by the Mail & Guardian shows that Nene told Myeni he would not approve the “unprofitable” route to Khartoum, despite knowing that the plan had Zuma’s stamp on it. It also shows that the plan would have cost the already desperately cash-strapped airline R30-million in the first two years of its operation.
The M&G has established that the SAA chairperson’s push to open the route began in earnest three months before al-Bashir controversially arrived in South Africa for the African Union summit in June last year. Al-Bashir is wanted by the International Criminal Court for war crimes and the high court in Pretoria ordered his arrest after his arrival. The government later sought to overturn that order, but was denied leave to appeal it.
At the time, Myeni told SAA executives that Zuma wanted to show support to “his brother” al-Bashir, in the interests of all South Africans. When the SAA executives appeared to drag their feet in dealing with Myeni’s proposal, she requested they prepare a “Sudan business case for the president of the republic”.
She told them the route was “strategic” for the president to show his support for al-Bashir.
The presidency did not respond to the M&G’s questions.
Both the SAA executive committee and the group executive committee turned down Myeni’s proposal to open the route because of “a lack of profitability” and “operational safety”.
Myeni then sent a letter to the treasury, two days after al-Bashir was mysteriously permitted to fly out of the country from the Waterkloof Airforce Base on June 15 last year, despite the court order demanding that he remain in the country.
Jacob Zuma and Dudu Myeni. (GCIS)
In July, after the dust of al-Bashir’s departure had settled somewhat, Nene, then still the head of the treasury, wrote back to Myeni: “I understand from your letter that the evaluation for a potential new route for SAA to Khartoum arose as a result of a discussion you had with his excellency, President Zuma.”
In his response to Myeni’s letter, Nene wrote that, “due to the loss-making nature of the proposed operations to Khartoum”, he would not approve the commencement of operations on it.
“Notwithstanding the projected losses, you have stated some alternative measures which could make the route financially viable. These include subsidisation of SAA services by the government of Sudan, or SAA undertaking operations on behalf of the government of Sudan as a designated flag carrier,” Nene wrote.
“The costs and benefits of these alternatives have not been provided and implementation, if possible, would require the engagement of various stakeholders within both the governments of the Republic of the Sudan and South Africa before being considered.”
The treasury had weekly technical meetings with SAA and was in constant communication with the airline, Nene wrote.
“During these meetings, SAA indicated that the letter received from you is purely for information purposes and was not a formal application as SAA would be required by law to make should it decide to open a new route to Khartoum.”
In a presentation to the standing committee on finance in Parliament in November last year, the treasury confirmed that it had “not approved” the opening of a route to Khartoum, but failed to mention that the proposal had come from the SAA chairperson, who has a nonexecutive role and had acted in defiance of the opinion of the company’s executive management.
Myeni’s involvement in trying to open the route preceded her controversial attempts to renegotiate an agreement signed by SAA with the French aircraft manufacturer Airbus. It emerged she was trying introduce a mysterious middleman into the deal, but her proposal was also apparently rebuffed by Nene.
Zuma later unceremoniously removed Nene from his crucial position on December 9 last year, causing the rand to plummet against other currencies and prompting bankers and economists to warn of a financial apocalypse.
Nene was replaced by the little-known Des van Rooyen, who was in turn replaced by Nene’s predecessor, Pravin Gordhan, just four days later.
With Nene out and Gordhan in the hot seat, the treasury put out a detailed statement, saying a change to SAA’s Airbus agreement as proposed by Myeni would leave the national carrier in “a materially worse-off financial position” because it would be unable to meet its commitments.
In response to questions sent to SAA and Myeni about the Khartoum route, the airline’s spokesperson, Tlali Tlali, said it was part of SAA’s approved long-term strategy to continue to increase its footprint in Africa.
“Based on this, a number of initiatives are being considered, with required assessments on their commercial viability to give full expression to the implementation of the strategy. A team from our commercial division has been hard at work to fulfil this mandate. They have been to South Sudan where they evaluated the viability of SAA operating to Juba. This is still work in progress and announcements will be made in due course,” he said.
In the same vein, other countries such as Sudan are being evaluated for operational viability based on available data and market intelligence.
“SAA will make its own assessment of the viability of the market and decide whether to operate or not. There are several other African countries that are being evaluated and decisions are made as and when the airline has obtained all the necessary and relevant information.”
The president was not a party to these processes, he said.
Contacted for his response this week, Nene declined to comment, and the treasury did not respond to questions.
The M&G has been reliably told that Zuma is looking for a new position for Myeni, who has been at the centre of a number of controversies at SAA and who also heads the Jacob Zuma Foundation. Although her future is being considered, it is not clear when a new permanent board for SAA will be appointed.