Bombshell Postal

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The head of South Africa’s Post Office, Fathima Gany, recently dropped a bombshell on lawmakers. As the Financial Times reported, Gany announced that she needed a $214 million bailout for the service or else it would be forced to shut down. She shed 4,000 of 11,000 staff and closed a third of the postal service’s branches, yet still couldn’t claw out of bankruptcy or the $487 million debt load.

The fate of the country’s Post Office, founded in 1792, symbolizes the problems that South Africa faces today. Basic services are decaying. Economic opportunities are tightening. Costs are rising. Poverty is inveterate. The International Monetary Fund listed those and other problems facing the country.

The debt especially concerns many outside of the country. China, for example, has invested heavily in South Africa as well as other countries on the continent. As outlined by the China Africa Research Initiative at Johns Hopkins School of Advanced International Studies, these deals often involve Chinese financing of extractive industries, like mines; infrastructure to move goods, like new railways, roads, ports, and airports; and diplomatically and politically beneficial projects like sports stadiums.

At the recent China-Africa Summit in Beijing, South African President Cyril Ramaphosa, for example, felt moved to refute sentiments that Chinese investors in Africa were setting the stage for a “debt trap” where Africa was forever in hock to the Chinese, Reuters noted. In the same remarks, he said he and Chinese leaders had reached a new energy deal that would benefit South Africans. He didn’t specify details.

But it is clear: Ramaphosa is presiding over a state that is crumbling. A judge recently sent a top official in the country’s national passenger railway system to prison for 15 years for using forged university qualifications, for instance, the Associated Press reported. The case revealed that he even used a fake job offer to entice railway executives to double his salary to convince him to stay with the organization.

Meanwhile, as Ramaphosa spoke in the Chinese capital, his political standing at home was perhaps weaker than ever. As World Politics Review wrote, Ramaphosa only managed to barely win reelection in the South African Parliament in June after promising to share power with opposition leaders and appointing their handpicked candidates for a few cabinet seats.

He was vulnerable because his party, the African National Congress, which overturned the racist Apartheid regime in the 1990s, had performed poorly at the May polls, losing its parliamentary majority for the first time in three decades. The party had failed to fix the country’s most pressing challenges: high unemployment, inequality and corruption, explained CBS News.

Still, as Chatham House wrote, “South Africa’s election provides an important example (for the region): that leaderships can no longer take power for granted, and that citizens across the region are seeking real change … and are impatient (for it).”