The wonderful news that South Africa has finally been removed from the Financial Action Task Force’s greylist of dodgy countries, after two years of hard work, underlines the paradox of our country.
On the one hand it shows that when we put our minds to it, when we deploy the best among us to the task, we are amazing. In two years we managed to fix 22 areas of concern and could be admitted back into a category of nation that does not raise red flags every time its government, businesses or citizens move money. It is a much-needed boost for the country’s low business and consumer confidence and a welcome pat on the back for our hard-working National Treasury.
On the other hand the development is deeply infuriating and frustrating. Why, in the first place, did we fall into a group of countries that were deemed to have failed to create sufficient mechanisms to fight money laundering and terrorist financing?
In 2023, when South Africa was greylisted, the country had gone through the state capture years and was five years out of that period. By then, one would imagine, we would have taken steps to ensure the financial shenanigans undertaken by the money launderers of that time would have been stopped. Clearly not. So, South Africa spent two years on the task force’s list of dodgy countries.
Let’s give credit where it’s due, though. South Africa continues to have institutions that are world-class, and the Treasury team under finance minister Enoch Godongwana still manages to shine despite a tough, bumpy few years and a deeply challenging time in the 2010s.
After the greylisting in February 2023 the team did not sit on its hands or waste time playing victim over the designation. It acted.
Ismail Momoniat, the veteran Treasury hand — and one of the quiet heroes who fought against the capture of the finance department in the 2010s — was brought in as technical adviser and a concerted plan was embarked upon. As Business Day pointed out, “multi-agency task teams were set up to address the task force’s findings, an action plan was drawn up, laws were amended, supervision tightened, and greater focus given to the prosecution of money-laundering and terrorism financing cases”.
It worked.
This two-year journey shows that we can do hard things. We have a wealth of talent, huge amounts of goodwill, and the hunger and grit to do good.
But we can’t do many terrible things and do only one good thing and expect to see progress. It’s imperative that we do many good things at the same time while increasingly doing fewer bad things over time. South Africa urgently needs this sort of culture change.
Last week, for example, home affairs minister Leon Schreiber said the government had deported 51,000 people in just the past year and that this number surpassed the combined deportations carried out by France and Germany. Of course no-one wants illegal immigration to our country. But what is the point of these fervent deportations while the country’s borders remain porous, border officials are notoriously corrupt and many home affairs officials are part of gangs that specialise in fraud, forgery, identity theft and other crimes that make South Africa a haven for illegal immigration and its cruel, criminal, masterminds?
The truth is that until we have a joint strategy for combating our problems, we will continue as we have done these past 16 years — fixing one hole in our boat while 10 others are letting water in.
The positive news about the greylisting is what we should be pleased about. But it should not happen while the police, the prosecuting authorities and other institutions are being corrupted and undermined. In the same vein, the efficiency of the home affairs deportations (in a humane manner) should be part of a holistic strategy to bring order to the immigration challenge we face.
That requires leadership from the top. There are islands of excellence such as the Treasury and parts of Schreiber’s home affairs, but not yet a movement towards systemic excellence. We win too little and fail too much.
Business body Operation Phumelela said the task force decision was “a watershed moment” and President Cyril Ramaphosa said it “bodes well for the integrity and reputation of our financial system”.
Hold your horses, folks. Let’s fix more institutions. Let’s see more of these wins. Then we can pat ourselves on the back afterwards.
