News / South Africa
The numbers are difficult to comprehend they are so staggering – more than R1.5 trillion looted in corruption between 2014 and 2019 alone – but when you look at them in real terms, the pain of what we have lost as a country is clear.
Similar to The Economist’s way of calculating the buying power of various currencies by using the cost of a McDonald’s Big Mac burger, we have analysed that looted amount – calculated by the Unite 4 Mzansi’s first case study, State Capture 101, released this year.
That stolen R1.5 trillion could have:
The R1.5 trillion is more than the entire national budget for this financial year, which stands at R1.35 trillion.
It also means, effectively, that every single South African citizen donated R25,000 to the looters. Working with an interest rate of 10% per annum, that looted amount would generate R150 billion a year in interest.
Economist Dawie Roodt said every rand stolen through corruption by default hurts South Africa more than the same amount stolen in, for example, the US.
“Since the rand is worth more locally than internationally, measuring the R1.5 trillion in corruption to the exchange rate in foreign currency does not give an accurate picture,” he said.
“That is because it can buy more locally than internationally. This means the true impact of corruption is felt deeper in South Africa than it may have been in another country.
“The most important thing is that, in the end, prosperity of a nation can be measured in life expectancy.”
In South Africa, it has dropped by roughly three years from 62.4 for men and 68.4 for women in 1994, to 59.3 and 64.6 for men and women respectively in 2021.
“As the ruling party is helping itself to our money, it’s also digging into citizen’s life expectancy,” said Roodt.
“And the problem is not only corruption, but incompetence. You cannot populate key roles in government or in the economy with cadres. Success needs people who know how to do the job, not political insertions kowtowing to the sticky fingers of their masters.”
South Africa’s foreign debt stands at close to R4 trillion. Not only are taxpayers paying back that money, but also funding the interest on this debt. At this rate, SA will be spending more on debt interest than it does on education.
The R150 billion a year in interest alone could: