Order Code RL31697
South Africa: Current Issues
and U.S. Relations
Updated October 7, 2008
Lauren Ploch
Analyst in African Affairs
Foreign Affairs, Defense, and Trade Division

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South Africa: Current Issues and U.S. Relations
Summary
Over a decade after the South African majority gained its independence from
white minority rule under apartheid, a system of racial segregation, the Republic of
South Africa is firmly established as a regional superpower and is considered to be
one of the United States’ two strategic partners on the continent, along with Nigeria.
With Africa’s largest Gross Domestic Product (GDP) and a government eager to play
an active role in the promotion of regional peace and stability, South Africa is poised
to have a substantial impact on the economic and political future of Africa. South
Africa, twice the size of Texas, has a population of 44 million, of which about 79%
is African and 10% white, and a diverse economy. The South African political
system is regarded as stable, but it faces serious long-term challenges arising from
poverty, unemployment, and the AIDS epidemic. The September 2008 resignation
of President Thabo Mbeki, replaced by interim President Kgalema Motlanthe, is not
expected to result in major policy changes prior to the 2009 elections.
The African National Congress (ANC), which led the struggle against apartheid,
continues to dominate the political scene, controlling the presidency, over two-thirds
of the National Assembly, all nine provinces, and five of the nation’s six largest
cities. The Congress of South African Trade Unions (COSATU) and the South
African Communist Party, key ANC partners, have been critical of the Mbeki
government, arguing that its policies have increased unemployment and failed to
respond adequately to the HIV/AIDS epidemic. Jacob Zuma was recently elected as
head of the ANC, and is expected to be the party’s candidate in the 2009 presidential
elections, although outstanding corruption charges could affect his candidacy.
South Africa has one of the largest HIV/AIDS populations in the world, with as
many as six million South Africans reportedly HIV positive. The Mbeki
government’s policy on HIV/AIDS has been controversial. The country has
weathered a series of corruption scandals, and continues to struggle with high crime
and unemployment rates. Mounting social tensions related to the competition for
jobs, resources, and social services led to an eruption of xenophobic violence against
immigrants in May 2008. Nevertheless, South Africa is currently experiencing its
longest period of steady economic growth, and analysts expect the government’s
widely praised economic reform program to show substantial results.
U.S. relations with South Africa are cordial, and South Africa has benefitted
from export opportunities offered under the African Growth and Opportunity Act
(AGOA, P.L. 106-200). However, the U.S. and South African administrations have
expressed differences with respect to the situations in Zimbabwe, Iran, and Iraq, and
U.S. officials have articulated frustration with the South African government on
positions it has taken while serving on the United Nations Security Council. This
report will be updated as events warrant. Related CRS reports include CRS Report
RL33584, AIDS in Africa; CRS Report RL32723, Zimbabwe; CRS Report RL34509,
Zimbabwe: 2008 Elections; CRS Report RL31772, U.S. Trade and Investment
Relationship with Sub-Saharan Africa: The African Growth and Opportunity Act and
Beyond; and CRS Report RS21387, United States-Southern African Customs Union
(SACU) Free Trade Agreement Negotiations: Background and Potential Issues.

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Contents
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Political Situation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Rise and Decline of the Democratic Alliance . . . . . . . . . . . . . . . . . . . . . . . . 4
Strains in the ANC Alliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
The Succession Debate and Mbeki’s Resignation . . . . . . . . . . . . . . . . . . . . . 6
The Arms Deal and Other Corruption Scandals . . . . . . . . . . . . . . . . . . . . . . 7
HIV/AIDS Controversy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Land Reform . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Crime . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
The Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Electricity Shortages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
U.S. Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Cooperation in Fighting Terrorism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Diplomatic Differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
The United Nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Zimbabwe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Prospects for the Future . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

List of Tables
Table 1. U.S. Merchandise Trade with South Africa . . . . . . . . . . . . . . . . . . . . . 24
List of Figures
Figure 1. Map of South Africa’s Provinces . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

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South Africa: Current Issues
and U.S. Relations
Background
The people of South Africa are highly diverse. Black Africans make up more
than three-quarters of the population, but come from several different ethnic
backgrounds. Most whites are Afrikaans speakers of Dutch, German, and French
Huguenot ancestry, but there is a substantial English-speaking white minority. The
remainder of the population are Asians, largely of Indian descent, and people of
mixed race, widely referred to as “Coloureds.”
South Africa’s economy,
the largest on the continent, is
South Africa in Brief
diverse as well. South Africa
produces wine, wool, maize and
Population: 44 million
other agricultural products for
African, 79%; whites, 9.6%; mixed race, 9%;
export, although only about 12%
Asian, 2.5%
of the country’s land is suitable
Population Growth Rate: -0.5%
Approximate size: twice the size of Texas
for agriculture. Moreover,
GDP (Official Exchange Rate): $274.5 billion
South Africa is the world’s
GNI per capita (Atlas Method): $5390
leading producer of gold,
Unemployment: 24.2%
platinum, and chromium. Major
Life Expectancy: 42.37 years
industrial sectors include
Prevalence of HIV/AIDS: 16.2%
a u t o m o b i l e a s s e m b l y ,
Literacy: 86.4%
chemicals, textiles, foodstuffs,
Religion: 80% Christian, 2% Muslim, 4% Other,
and iron and steel production.
15% None
South African cell phone
Language most often spoken at home:
companies and other firms are
Zulu, 24%; Xhosa, 18%; Afrikaans, 13%;

Sepedi 9.4%, English 8.2%, Setswana 8.2%,
active throughout Africa, and
Sesotho 7.9%, Xitsonga 4.4%
SABMiller, formerly South
Sources: World Bank, CIA World Factbook , UNAIDS.
African Breweries, operates on
a global scale. The service
sector recently surpassed
mineral and energy resources as
South Africa’s primary income earner, according to the World Bank. The country’s
stock exchange is among the 20 largest in the world, and South Africa is one of the
few countries on the continent to rank as an upper middle income country. Despite
South Africa’s many economic strengths, however, the country ranks as one of the
most unequal societies in the world in terms of income distribution. The majority of
black South Africans live in poverty, and South Africa’s cities are surrounded by vast
informal housing settlements known as “townships.” Shortages of water, electricity,

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and other social services in the townships have contributed to growing tensions, as
evidenced by a rise in township protests in recent years.
South Africa is an influential actor in the international relations of Africa. In
October 2006, South Africa was elected as one of the 10 non-permanent members of
the United Nations (U.N.) Security Council for a two-year term, and it is a member
of the U.N. Human Rights Council. Its voting record on both bodies has been
considered by some to be controversial. South Africa was a founding member of the
African Union (AU), successor to the Organization of African Unity (OAU), and
then-President Thabo Mbeki served as the AU’s first chairperson.1 President Mbeki
also took a lead role in the development of the New Partnership for Africa’s
Development (NEPAD), an African-designed plan for improved governance within
Africa and increased western aid, trade, and investment that was adopted by the AU
as its economic framework.2 South Africa has repeatedly put itself forward as a
venue for major international conferences, such as the World Summit on Sustainable
Development, which met in Johannesburg in August and September 2002, and the
World Conference on Racism in 2001. In 2010, it will host the soccer World Cup,
which is expected by some to have a significant impact on the country’s overall
economic growth and job creation.
Civil war, weak regimes, and general instability in the region have historically
had a negative impact on South Africa, and the country continues to face a large
influx of illegal immigrants. Government officials estimate that between three and
five million Zimbabweans currently reside illegally in South Africa.3 Some South
Africans blame these immigrants for the country’s high crime and unemployment
rates and rising food prices, and in May 2008 tensions erupted in the townships,
sparking a wave of xenophobic attacks that displaced over 25,000 and left over 60
dead. The attacks could have long term consequences for attendance of the World
Cup and for tourism in general.
In order to promote greater stability, former President Mbeki and South African
officials have played prominent mediator roles in African conflicts, and South
African troops actively support peacekeeping missions throughout the continent. In
2002, they helped to persuade the parties to the prolonged conflict in the Democratic
Republic of the Congo (DRC) to sign a peace agreement following negotiations in
South Africa. Mbeki was less successful in mediating the conflict in Cote d’Ivoire.
Over 1,000 South African troops are currently participating as peacekeepers in the
U.N. Mission in the DRC (MONUC), and the country contributed almost 900
soldiers to the U.N. Operation in Burundi (ONUB), where former President Nelson
Mandela played a leading role in brokering a peace agreement. South African forces
also played a key role in the African Union Mission in Darfur (known by the
acronym of AMIS), and now contribute to the U.N.-African Union Mission in Darfur
1 See CRS Report RS21332, The African Union, by Nicolas Cook.
2 See CRS Report RS21353, New Partnership for Africa’s Development (NEPAD), by
Nicolas Cook.
3 “South Africa Struggling to Cope With Zimbabwean Refugees,” BBC Monitoring Africa,
London: July 24, 2006.

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(UNAMID).4 In a move believed by many to protest the Sudanese government’s
policies toward Darfur, the Mbeki government was instrumental in preventing Sudan
from attaining the chairmanship of the African Union in 2006. It has, however,
protested the potential imposition of U.N. sanctions against Sudan as
counterproductive.5 The country has supported democratic advances elsewhere on
the continent, providing millions of ballots for elections in the DRC. In March 2007,
the heads of state of the Southern African Development Community (SADC)
nominated then-President Mbeki to serve as a mediator between the Zimbabwean
government and the opposition in an effort to resolve that country’s political and
economic crises (see “Zimbabwe” below). Mbeki’s role has been controversial.
Political Situation
The Republic of South Africa held its first universal suffrage elections in April
1994. The African National Congress (ANC), which had led the struggle against
white minority rule and the apartheid system of state-enforced racial segregation,
won control of the National Assembly. The Assembly chose as President Nelson
Mandela, the ANC leader who had been released from prison in 1990, after serving
27 years. His release followed years of secret contacts between the ANC and key
white business and political figures. These contacts had led both sides to conclude
that a settlement could be negotiated that would protect the interests of all South
Africans. The negotiations themselves encountered many difficulties, including
several outbreaks of violence that threatened to destroy the peace process. Finally,
however, in November 1993, all-party negotiations resulted in a final agreement on
a new constitution and free elections, held in 1994. South Africa’s second universal
suffrage elections were held in June 1999, and the ANC retained control of the
National Assembly. Deputy President Thabo Mbeki, who had served in key ANC
posts overseas during the anti-apartheid struggle, was chosen by the Assembly to
succeed Mandela. Mbeki retained his position as President following the April 2004
parliamentary elections, in which the ANC won almost 70% of the votes.
South Africa’s politics continue to be dominated by the ANC, which has
enjoyed support among many black South Africans because of its role in
spearheading the long struggle against white minority rule. Until December 2007,
when he lost the party presidency to a rival, Thabo Mbeki served as president both
of the party and the country.6 He was expected to remain President of South Africa
until the next elections in 2009 but resigned from the position in September 2008.
4 South Africa’s involvement in AMIS has not been without controversy. Some opposition
leaders have criticized Mbeki for not taking a more assertive role in the crisis, and some
South African troops threatened to pull out of AMIS in November 2006 over a pay dispute.
With the AMIS force expected to expand significantly under the”hybrid” U.N.-AU force
UNAMID, questions remain regarding South Africa’s contribution.
5 “Sanctions Threat on Sudan Counterproductive: South Africa,” Agence France Presse,
June 21, 2007.
6 Under the South African constitution, the President is elected by the National Assembly,
and consequently, the next President is likely to be chosen from the majority ANC party.

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He has been replaced by an interim president, Deputy ANC leader Kgalema
Motlanthe. The ANC holds a 73% majority of the seats in the 400-member National
Assembly, where the country’s legislative power principally resides, far ahead of its
nearest rival, the Democratic Alliance (DA), which has just over 12%. The Inkatha
Freedom Party (IFP), headed by Mangosuthu Buthelezi, has about 9% of Assembly
seats. Buthelezi, who has been active in South African politics for decades, holds a
Zulu chieftainship, and the party is largely Zulu in membership. The IFP has
experienced a steady decline in parliamentary seats since the 1994 election, while the
ANC and the DA have gained electoral support. Other parties represented in
parliament include the New National Party (NNP, see below), the United Democratic
Movement (UDM), the Independent Democrats (ID), and the African Christian
Democratic Party (ACDP). The ANC also holds majorities in all of South Africa’s
nine provincial assemblies. In addition to the National Assembly, there is a higher
legislative body, the National Council of Provinces (NCOP), with limited powers.
The members of NCOP are chosen by the governments of the nine provinces, all
controlled by the ANC.
Rise and Decline of the Democratic Alliance
The second largest party in the National Assembly, the Democratic Alliance
(DA), was created in 2000 through a merger of the Democratic Party (DP) and the
New National Party (NNP), to challenge ANC dominance of the political system.
The merger surprised many analysts, since the NNP was directly descended from the
National Party, which had created apartheid and established the white minority
regime that ruled South Africa for more than 40 years. In contrast, the DP, though
also largely white, advocated a classical liberal platform and was heir to the
Progressive Party, which had strongly opposed apartheid and campaigned on human
rights issues. However, by allying, the two parties were able to ensure their control
of the legislature of Western Cape Province and of many local governments in the
province, including the government of Cape Town, in the 2000 local elections.7
DP leader Tony Leon, an articulate critic of the ANC with respect to the slow
pace of privatization, transparency, and other issues, became DA leader, with NNP
head Marthinus van Schalkwyk as his deputy. The alliance soon fragmented in a way
that has further enhanced the power of the ANC in South African politics. In
October 2001, van Schalkwyk announced that the NNP would leave the DA and
enter into a cooperative agreement with the ANC. The NNP leader explained that
the move would promote national unity and progress, while critics suggested that he
was primarily interested in securing government appointments for NNP leaders.8
Van Schalkwyk’s break with the DA precipitated a prolonged national debate
over “floor crossing” — that is, over whether elected NNP representatives in
assemblies at the local, provincial, and national levels should be permitted to cross
7 Tom Lodge, “The Future of South Africa’s Party System,” Journal of Democracy, Vol 17,
No. 3, July 2006, p. 154.
8 In November 2002, Mbeki named two NNP figures to positions as deputy ministers in his
government. “Mbeki Gives Van Schalkwyk Space with New Positions,” Business Day,
November 5, 2002.

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over from the DA to the new ANC/NNP alliance. Representatives at all levels in
South Africa are elected not as individuals but because their names appear on lists
selected by each party. The proportion of the vote received by a party in an election
determines how many of those on its list will be given seats. Many argue that floor
crossing in such a system thwarts the will of the voters, and it had not been permitted
in South Africa. However, in 2002 the Constitutional Court allowed floor crossing
at the local level, throwing control of Cape Town and a number of other towns to the
ANC and its NNP allies. The National Assembly passed legislation in 2003 allowing
MPs to change their party affiliation during two week “window periods.” As a result
of a September 2005 “window period,” the ANC gained 14 seats, including all seven
NNP parliamentarians and four DA MPs who complained of racism within the party.
Although the ANC controls the provincial government of Western Cape, the city
of Cape Town remains the last major urban opposition bastion. Following a close
win by the DA candidate Helen Zille in 2006, the ANC began a controversial bid to
change the city’s government from a mayorally-dominated system to one run by a 10-
member committee, which would have left the current mayor a de facto figurehead.
Subsequent criticism by the other parties appears to have persuaded the ANC to drop
its proposed restructuring plan. Zille replaced Tony Leon as head of the party when
he stepped down in May 2007.9
Strains in the ANC Alliance
The ANC has long worked in an interlocking tripartite alliance with the
Congress of South African Trade Unions (COSATU) and the South African
Communist Party (SACP). Leaders of COSATU and the SACP sit on the National
Executive Committee (NEC) of the ANC, which is the party’s principal decision-
making body. However, there has been considerable disagreement among the ANC
and its allies over the government’s economic reform programs. The government’s
first major economic strategy, known as Growth, Employment, and Redistribution
(GEAR), sought to spur economic growth by attracting foreign investment,
strengthening the private sector, and privatizing state-owned enterprises. COSATU
and the SACP have argued that this approach has failed to benefit South Africa’s
poor. They favor the creation of programs that would use state resources to create
jobs and a moratorium on privatization. In 2005 the general secretary of COSATU
announced in a union meeting, “We want the ANC to be maintained as an
organization primarily of the workers and the poor. We will never hand over this
weapon, built up with our blood, sweat, and tears, to the other side on a silver platter.
We will never let the ANC be privatized by the rich. It is a working class formation
and a left-wing liberation movement — it must remain ours.” Former President
Mbeki, on the other hand, has argued that the ANC is a “broad church” capable of
representing socialists and nationalists and bridging class divisions.10
COSATU also has been highly critical of Mbeki’s stance on the AIDS epidemic
and his approach toward the Zimbabwe situation (see below). In June 2007 the
9 “South Africa: Balanced Opposition,” Business Day, April 26, 2007.
10 “Mbeki, Nzimande Clash Over Splits in Alliance,” Business Day, October 9, 2006.

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country’s trade unions launched what is reported to have been the biggest strike since
the end of apartheid, costing the economy an estimated $418 million.11 The unions,
who were demanding a 12% pay raise for public servants, accepted the government’s
offer of a 7.5% raise after four weeks of protest. In 2006, COSATU had launched
a smaller general strike to protest the loss of 100,000 jobs over the past three years,
primarily from the textile and mining industries. That strike followed a series of
others held in 2005, and they have been considered significant acts of defiance
against the policies of the Mbeki government. Many analysts contend that the rift
between COSATU, its populist allies, and Mbeki supporters within the ANC has
widened in recent years, and some believe a split may be imminent.12 Speculation
regarding a possible splintering of the ANC has grown in the wake of the
resignations of Mbeki and several of his allies.
The Succession Debate and Mbeki’s Resignation
As President Mbeki neared the end of his second term as president of the ANC,
there was considerable speculation on whom the party might choose for the position
at the ANC’s national congress in December 2007. Mbeki had suggested that he
would not run for a third term. His successor would be widely expected to succeed
him as President of the country following the national elections in 2009. Although
the ANC’s party constitution allows for a competitive leadership race, no party
presidential candidacy had ever been contested. Mbeki’s dismissal of Jacob Zuma
as the country’s Deputy President in 2005 (see below) exposed divisions in the party
(Zuma remained deputy president of the party). He had been widely considered to
be the likely successor to Mbeki prior to these scandals. Zuma, a populist who has
elicited strong support from both youth and labor groups, as well as from his Zulu
ethnic base, has been linked with a number of controversies, including a 2006 rape
allegation for which he was acquitted, and a high profile corruption case (see “The
Arms Deal” below). Zuma made his intention to vie for the party leadership post
clear, and he was vocally supported by leaders from COSATU and SACP, who claim
he has been a victim of political conspiracy. After months of speculation, Mbeki,
rather than put his support behind a chosen successor, chose to run for a third term
as ANC president. Zuma won a decisive victory over Mbeki in a secret ballot vote
at the national congress, suggesting that Mbeki had alienated many in the party.
Although he prevailed in the rape and initial corruption trials, Zuma still faces
legal challenges. In November 2007 the Supreme Court of Appeal overturned a
lower court decision that had made documents seized from Zuma and his lawyer
inadmissable in future proceedings. He was expected to go on trial again in August
2008 for racketeering, money laundering, fraud, and corruption, but the date of his
trial was postponed until 2009. Should Zuma be convicted prior to the 2009
elections, he would be ineligible to run for the presidency.
On September 20, 2008, after nine years in office, Thabo Mbeki announced that
he had accepted a request by the ANC’s National Executive Council to resign as
11 “S Africa Unions Call Off Strike,” BBC, June 28, 2007.
12 “ANC in Turmoil Over Issue of Mbeki’s Successor,” Irish Times, October 12, 2006.

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President of South Africa. The Council’s recommendation came in the wake of a
court decision suggesting that Mbeki and members of his administration had
interfered in the Zuma corruption case. One-third of Mbeki’s cabinet resigned with
their leader. Among them was Finance Minister Trevor Manuel who, along with
Reserve Bank Governor Tito Mboweni, has been widely credited with guiding the
country’s economic progress since the end of white rule. Inflation rose above 13.7%,
the highest level since the end of apartheid, amid speculation of Manuel’s
resignation; he was later reappointed. Other resignations have followed, including
that of the Gauteng province premier, who said that he would not be able to “publicly
explain or defend the national executive committee’s decision on comrade Thabo
Mbeki.”13 The parliament elected Kgalema Motlanthe, deputy leader of the ANC,
as interim President. Motlanthe, a former mine union leader who was imprisoned on
Robben Island with Mandela, had recently been appointed by the party as a Member
of Parliament, which made him eligible to assume the presidency. Zuma, who does
not hold a parliamentary seat, was ineligible to assume the office.
The judge issuing the High Court verdict on which the request for Mbeki’s
resignation was based found that the corruption charges against Jacob Zuma should
be thrown out on procedural grounds, but the court made no findings on Zuma’s guilt
or innocence. Prosecutors have filed an appeal to overturn the ruling.
The Arms Deal and Other Corruption Scandals
A $5.5 billion arms purchase announced by South Africa in 1999 continues to
pose political problems. Questions remain over the country’s need for aircraft,
submarines, and surface vessels which were to be acquired under the deal with five
European firms. More pressing are allegations of corruption associated with the
purchase. Tony Yengeni, the ANC’s former chief whip in the National Assembly,
was arrested in 2001 on charges of corruption, forgery, and perjury in connection
with a large discount he received for the purchase of a luxury car, allegedly in return
for assuring that the deal went ahead. He pled guilty to fraud in exchange for
acquittal on corruption charges. President Mbeki later fired Deputy President Jacob
Zuma, after a judge declared Zuma had a “generally corrupt” relationship with his
former financial advisor, Schabir Shaik, who was convicted of fraud and corruption
in connection with the arms deal. Zuma was indicted but acquitted in September
2006, after prosecutors failed to build a case against him. Shaik lost an appeal of his
conviction in November 2006, when judges ruled that evidence overwhelmingly
supported the charge that payments totaling about $165,000 made by Shaik to Zuma
were bribes. Critics maintain that several questions related to the arms deal remain
unresolved, and some are concerned that promised “offsets” — that is, investments
by the arms suppliers in South African industry — have not materialized.14
The South African media has also focused attention on the “Travelgate” scandal,
in which over twenty current and former members of parliament, most from the
13 “Manuel Plays Down Chance of ANC Split,” Mail and Guardian, September 30, 2008.
14 “The Arms Deal — The Shadows Lengthen,” Business Day, September 20, 2006;
“Comment and Analysis: The Sordid Truth Behind an Arms Deal: How a UK Company
Gains While South Africa’s Poor are Losing Out,” The Guardian (London), July 17, 2002.

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ruling ANC party, have appeared in court since 2005 on charges of corruption.
Accused of abuse of official travel privileges, the MPs reportedly stole some $3
million in government funds. According to Transparency International, the
prosecutions have shown that “the anti-corruption bodies and judiciary have a fair
degree of independence and are able to carry out their functions without hindrance,
even when high ranking members of the ANC were involved.”15 “Travelgate” was
followed by another reported scandal popularly referred to as “Oilgate,” an allegedly
corrupt oil deal between a state-owned oil company and a black economic
empowerment company (see below), in which public funds were reportedly illegally
diverted into an ANC party campaign fund. To add to the controversy, one of the
country’s leading newspapers, the Mail & Guardian, was banned by the courts from
publishing a report on the scandal. According to media reports, the court ruling found
that publishing the report would damage the oil company’s right to privacy and was
potentially defamatory.16 The gag order was reportedly the first placed on the paper
since apartheid, and was denounced as “an extraordinarily dangerous precedent” to
press freedom by the press watchdog group, the Media Institute for Southern Africa.
South Africans are now avidly following another potential scandal. South
Africa’s chief prosecutor, Vusi Pikoli, was suspended in September 2007 on charges
of prosecutorial excess by President Mbeki. Many suggest that the subsequent arrest
of national police commissioner Jackie Selebi amid allegations of ties to organized
crime was directly linked to Pikoli’s suspension.17 Pikoli had been preparing
warrants for Selebi’s arrest when he was suspended. Selebi, a senior ANC member,
is widely considered to be a Mbeki supporter within the party, and some South
Africans have accused Mbeki of trying to prevent Selebi’s arrest. These cases
suggest rising political tensions between the country’s law enforcement agencies. As
chief prosecutor, Pikoli oversaw the Scorpions (the Directorate of Special
Operations), South Africa’s financial crimes investigative unit. Several leading ANC
officials have recently led efforts to have the Scorpions, who have prosecuted several
high profile corruption cases, including that of Zuma, disbanded. Zuma and his allies
have criticized the Scorpions’ prosecution of him as politically motivated. They
suggest that the Scorpions’ duties should be subsumed by the national police, but
others argue that the unit’s “special status” under the National Prosecuting Authority
is needed to tackle corruption at the highest levels. Despite strong opposition from
the country’s opposition and civil society, the unit has been moved by parliament
under the authority of the police service.
15 Berlin-based Transparency International describes itself as a non-governmental
organization devoted to combating corruption. Transparency International, Global
Corruption Report 2006, Available at [http://www.transparency.org].
16 The Media Institute of Southern Africa, “Media Freedom Has ‘Suffered Major Blow,’”
May 28, 2005.
17 See, for example, “Lets All Arrest One Another,” The Economist, January 17, 2008 and
“Party Power Struggle Enthralls South Africa,” New York Times, October 12, 2007.

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HIV/AIDS Controversy
Thabo Mbeki’s stance on HIV/AIDS has been a major political issue in South
Africa. According to the Joint United Nations Program on HIV/AIDS (UNAIDS),
an estimated 16.2% to 18.8% of South African adults, aged 15-49, were HIV positive
at the end of 2005.18 UNAIDS also reports that 1.2 million children currently living
in the country have been orphaned by the disease. A study by the South African
Department of Health concluded that over 30% of pregnant women were HIV
positive in 2005.19 As these figures show, the situation is grave.
Critics maintain that the former President’s ambiguous statements about the
disease and lack of leadership on the issue diverted attention and funding from the
pandemic at a critical time. In 2000, President Mbeki wrote to then-President
Clinton and other heads of state defending dissident scientists who maintain that
AIDS is not caused by the HIV virus. In 2001, he rejected appeals that the National
Assembly declare the AIDS pandemic a national emergency. In 2002, President
Mbeki drew criticism from the media and others for reportedly insisting that
tuberculosis rather than AIDS was the leading cause of death in South Africa, even
though the country’s Medical Research Council had reported that AIDS was the
leading cause, accounting for 40% of mortality among adults aged 15-49.20 The
reasons for former President Mbeki’s stance on AIDS have been difficult to discern,
particularly given that he might have reaped great political advantage from becoming
a leader in fighting the epidemic. Some speculate that he feared that AIDS could
undermine his vision of South Africa as a leader in an African renaissance sparked
by NEPAD and the African Union. As a result, some believe that he has tended to
minimize the importance of the epidemic.
In recent years, under mounting domestic and international pressure, the Mbeki
government gradually modified its stance on HIV/AIDS. In 2002, the government
announced that it would triple the national AIDS budget, end official opposition to
the provision of antiretrovirals for rape victims, and launch a program for universal
access to drugs to prevent mother-to-child transmission (MTCT) of HIV. In July
2002, a South African court ordered the government to begin providing the
antiretroviral (ARV) drug Nevirapine nationwide to reduce MTCT. The South
African Treatment Action Campaign (TAC) had launched the suit in 2001,
maintaining that MTCT prevention trials were inadequate and that 20,000 babies
18 UNAIDS, 2007 AIDS Epidemic Update, December 2007. In late 2007, UNAIDS
published revised global AIDS demographic data. For some countries, it also provided
information on national HIV prevalence rates derived from the most recent population-based
health survey in countries that have conducted them since 2002. In some cases, these rates
are lower than previous UNAIDS country estimates, which were published in May 2006
(UNAIDS, 2006 Report on the Global AIDS Epidemic).
19 This figure was extrapolated from testing done on patients at antenatal clinics in the
National HIV and Syphilis Prevalence Study South Africa 2005, Department of Health of
South Africa, 2005.
20 “South Africa President Mbeki Criticizes U.N. AIDS Fund Grant,” Associated Press, July
25, 2002, and “Research Affirms Disease Is Nation’s Leading Cause of Death,” The
Washington Post, October 19, 2001.

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could be saved yearly by a nationwide program.21 At its December 2002 party
conference the ANC announced that it was “putting AIDS at the top of our
agenda.”22 The Department of Health in 2003 declared that the government would
provide free antiretroviral drugs, but after what observers considered a very slow
implementation of the policy, TAC threatened another lawsuit. Under pressure, the
government began providing treatment at five hospitals in 2004 and has gradually
expanded access to the program. Reports suggest that access to treatment is still
limited in South Africa — by the end of 2005 only an estimated 200,000 people in
the country were receiving antiretroviral therapy (ART), a significant increase from
previous years, but accounting for an estimated 21% of those in need, according to
the Kaiser Family Foundation.23
Despite this commitment by the government to providing ART, many critics
still did not consider the Mbeki administration to be serious about the epidemic. In
August 2006 then-Health Minister Manto Tshabalala-Msimang drew international
criticism for a controversial display of traditional remedies such as garlic, lemons,
and beetroot, which she reportedly claimed provided an alternative defense to AIDS,
at the International AIDS Conference in Toronto. Stephen Lewis, the U.N. Special
Envoy to Africa on AIDS, proclaimed South Africa’s AIDS policies as “wrong,
immoral, and indefensible” and “worthy of a lunatic fringe” during the conference,
and 81 international scientists delivered a petition to Mbeki urging the health
minister’s dismissal.24 Many observers consider the Toronto Conference to have
prompted a key shift in the government’s position. Weeks after the conference,
Mbeki appointed his Deputy President, Phumzile Mlambo-Ngcuka, as head of a new
national AIDS commission charged with halving the country’s infection rate by 2011.
She emphasized that the government did believe that HIV causes AIDS and
acknowledged “shortcomings” in the government’s response to the epidemic. The
government also reached out to the AIDS advocacy community, which responded
with cautious optimism. TAC, the most vocal critic of the Mbeki Administration’s
efforts, was cited in late 2006 saying that there was now “a growing enthusiasm,
across the board, around the possibility of what we can do as a country in a united
fashion” to combat the disease.25 However, TAC more recently questioned the
government’s commitment to fighting the epidemic after the August 2007 firing of
Tshabalala-Msimang’s deputy, who was outspoken about problems with the nation’s
health services and critical of the Health Minister’s controversial views on AIDS.
21 “AIDS Activists Sue South Africa,” Associated Press, August 21, 2001.
22 Reuters. President Mbeki was criticized by some, however, for not giving the AIDS
epidemic greater prominence in his address to the conference.
23 Kaiser Family Foundation, HIV/AIDS Policy Fact Sheet, August 2006.
24 The letter, titled “Expression of Concern by HIV Scientists,” can be found at
[http://www.aidstruth.org/letter-to-mbeki.php]. See also “Under Fire, South Africa Shakes
Up Its Strategy Against AIDS,” The New York Times, September 3, 2006, and “In South
Africa, a Dramatic Shift on AIDS; Treatment, Prevention Get New Emphasis as Deputy
President Takes Key Role,”The Washington Post, October 27, 2006.
25 “Under Fire, South Africa Shakes Up Its Strategy Against AIDS,” The New York Times,
September 3, 2006.

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AIDS activists have responded positively to President Motlanthe’s appointment of
a new health minister, Barbara Hogan.
Land Reform
In order to address historic injustices, the South African government began a
land reform program in the late 1990s to restore land rights to those forcibly
dispossessed of their land under racially discriminatory apartheid legislation. The
government set a number of targets, including the settlement of all land claims26 by
the end of 2008 and the more ambitious transfer of 30% of agricultural lands owned
by whites in 1994 to African owners by 2014. While the government’s “willing
buyer, willing seller” land reform policies have reportedly met with little resistance
from white landowners, and the Land Affairs Department reports that almost all land
claims have been settled, critics charge that the transfers are going too slowly.
According to media reports, the government announced in August 2006 that
negotiations with white farmers over the price of land marked for restitution would
be limited to six months, after which expropriation could take place if no settlement
was reached.27 Two months later, two white-owned farms claimed by black South
Africans were marked for expropriation, a process through which the government
would seize the land and pay the owners a price set by independent assessors.28 This
ruling has been seen by some analysts as signaling a sense of urgency on the part of
the government to speed up reforms.
In a 2005 speech on the perceived slow pace of land transfers, Deputy President
Mlambo-Ngcuka said that South Africa might learn from Zimbabwe’s land reform
process, igniting considerable controversy. President Mbeki dismissed critics of the
speech, saying the Deputy President’s words were misinterpreted and that
Zimbabwe’s policies were only one among many the government had studied. The
media reported a similarly controversial discussion document circulated by the Land
Affairs Department suggesting replacing the “willing buyer, willing seller” approach
with a “Zimbabwean model,” or forced-sale principle (Zimbabwe’s policy that
preceded the country’s land invasions). Under this proposed model, farmers who
want to sell their land must offer the government the right of first refusal. If they
refused a government offer, they could not sell the land on the open market. The
discussion paper was said to propose the expropriation of commercial agricultural
land to meet the government’s target of 30% redistribution. At that time, government
officials stressed that the document was for internal discussion only and did not
reflect official policy.29
In 2008, the Mbeki Administration appeared determined to speed up the transfer
of commercial agricultural lands. Official figures suggest that the government has
26 Black citizens have filed 79,700 land claims since January 1999, according to a report by
Michael Wines, “South Africa to Seize Two White-Owned Farms,” New York Times,
October 10, 2006.
27 “ANC Gives Ultimatum to White Farmers,” The Daily Telegraph, August 14, 2006.
28 “South Africa to Seize Two White-Owned Farms, New York Times, October 10, 2006.
29 “‘Zimbabwe’ Land Option Mooted by Officials,” Business Day, October 16, 2006.

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met only 5% of its 30% target for state-funded transfers, and the Land Affairs
Department suggests that sellers are demanding excessively high prices. The
government tabled legislation before parliament in July that would accelerate the
process by adding a constitutional provision for expropriation of a property “for a
public purpose.” Critics, including the Democratic Alliance, argued that the
proposed law, which would restrict property owners’ rights to judicial appeal and
force sales at below market prices, would undermine confidence in property rights
and deter investment.30 They also suggest that while the rate of state-funded transfers
has been slow, substantial transfers have been made privately through the property
market. The legislation was shelved, but some speculate that it will be resubmitted.
In a 2004 survey of South Africans of all races, 72% of black respondents
agreed with the statement: “All the land whites own, they stole from blacks.”31
According to an independent South African think tank,
The most universal and immediate land need in South Africa is for ‘a place to
stay’ rather than ‘a place to farm’.... Even among employed agricultural workers,
land demand is modest. Among people living on the land without alternative
sources of income, however, aspirations for land or more land can reach high
levels, and become very intense. Although this is a minority group, it is large in
numerical terms, and hence constitutes a significant policy challenge.32
The targets for reform set by the ANC government have set public expectations high,
and some analysts suggest that the perceived pace of land reform could become a
major issue in the 2009 general elections.
Crime
As South Africa prepares to host hundreds of thousands of tourists during the
soccer World Cup in 2010, the government continues to battle perceptions that the
country is not safe for tourists because of its high crime rate. According to one
survey, one-third of potential tourists have been deterred from visiting South Africa
out of fear of becoming victim to a criminal act.33 Some analysts attribute the high
rate of crime to the country’s high level of wealth disparity, but also to shortcomings
within the police force and in the lack of a comprehensive government approach.
South African officials have acknowledged the problem. In February 2007, then-
President Mbeki admitted crime had created a high level of fear around the country,
and the South African Safety and Security Minister called the high number of cases
30 “Expropriation Must Be a Land Resort,” Business Day, May 30, 2008.
31 In a survey of 3500 respondents conducted by Markinor for Pierre du Toit, department
of political science, University of Stellenbosch, in February and March 2004, South
Africans were asked to respond to the statement: “All the land whites own, they stole from
the blacks.” and were asked to present their responses in a range, from “strongly agree” to
“strongly disagree”. Over 72% responded “strongly agree” or “agree.” Cited in “Land Issue
Illustrates Social Rift,” Business Day, 5 May 2004.
32 The Centre for Development and Enterprise, Land Reform in South Africa: a 21st Century
Perspective, Johannesburg: June 2005, p. 30.
33 “Crime ‘Deters’ SA 2010 Tourists,” BBC, July 23, 2007.

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of violent crime “disconcerting and unacceptable.”34 The government has announced
plans to recruit 30,000 new police officers before the games.
The Economy
South Africa won praise from international economists for its reform-oriented
macro-economic policy in the late-1990s, which, according to the U.S. Department
of Commerce, “demonstrated its commitment to open markets, privatization, and a
favorable investment climate, moving away from the former government’s strategy
of import substitution and industrial development that protected local industries with
high tariff barriers.”35 The policy, known as the Growth, Employment and
Redistribution (GEAR) strategy, however, delivered mixed results — it engendered
macroeconomic stability, fiscal discipline, and trade liberalization. However,
unemployment continued to rise, and income distribution did not show signs of
significant improvement. Nevertheless, the income of the average black household
almost doubled in the first decade after the end of apartheid.36
The rate of growth in Gross Domestic Product (GDP) averaged 3% per year in
the first decade after apartheid and rose to an average of 5% in the past three years.
While these annual GDP growth rates represent an advance over economic
performance in the 1990s, much higher growth rates will be needed if South Africa
is to substantially increase employment among the black majority and reduce the
sharp inequalities in income distribution among the races. Unemployment estimates
range from 25% to 40%, far above the government’s target of 15%. The vast,
poverty-stricken townships surrounding South Africa’s cities remain a potential
source of political instability. In recent years periodic riots have erupted in several
poor municipalities to protest local government corruption and inadequate service
delivery. Although turnout and support for the ANC remained high nationally in the
country’s last municipal elections, voters boycotted the polls in a number of
townships in which the ANC had formerly enjoyed strong support, and several
hundred former ANC supporters stood as independent candidates. Conditions in the
townships have improved marginally with the expanded availability of electricity and
the provision of clean water taps. However, popular resentment is reportedly
deepening with respect to the widening gap between the rich and poor.
Some economists attribute South Africa’s economic difficulties, in part, to the
slow pace of privatization. Despite its commitment to privatization, the government
remains heavily involved in transportation, communications, energy production, and
the defense sector, and after the 2004 elections expressed a desire to restructure most
remaining state-owned enterprises rather than expand privatization. Delays are due
partly to government concerns that privatization will boost unemployment
34 “SA Violent Crime ‘Unacceptable,’” BBC, July 3, 2007.
35 U.S. Department of Commerce, South Africa Country Commercial Guide, Fiscal Year
2003, July 2002.
36 The average household income for blacks increased by 71% from 1996 to 2004, according
to the South African Institute for Race Relations’ South Africa Survey 2004/2005.

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temporarily, fueling criticism from COSATU and the SACP. Moreover, the
government is trying to find ways to promote “black empowerment” by assuring that
a significant portion of the shares in privatized companies will be acquired by black
South Africans rather than by wealthy whites or foreign investors. Another point of
view, championed by COSATU and the SACP, is that job cutbacks that often follow
privatization are contributing to unemployment and the growing income gap in South
Africa. Some argue that the government should be intervening in the economy to
save jobs, and to create new jobs, perhaps through a major public works program.
In 2005, the Mbeki government unveiled its new Accelerated and Shared
Growth Initiative for South Africa (ASGISA), which is designed to raise the average
economic growth rate to 4.5% from 2004-2009 and to at least 6% from 2010-1014
through targeted interventions, including public investment in infrastructure. The
ASGISA plan also aims, through these economic growth policies, to cut
unemployment rates in half by 2014. Another economic program, the government’s
Black Economic Empowerment (BEE) program, was initiated in 1994 and is
designed to address racial inequalities in the business sector. In 1994, blacks owned
less than 5% of the country’s private enterprises; today over 30 black-owned or
black-empowered companies (approximately 15%) are listed on the South African
stock exchange. This rise in black ownership is echoed by a significant increase in
the black middle class.37 Nevertheless, the lack of skilled labor may be hampering
the success of the program, as may complicated or unclear regulations. According to
a 2005 survey of domestic and foreign firms, “While supporting the need for
affirmative action, most foreign investors acknowledge that the lack of clarity
surrounding the application of Black Economic Empowerment has had a dampening
effect on their plans to further invest in South Africa.”38 In February 2007, the
government instituted the BEE Codes of Good Practice, which make both listed and
unlisted companies subject to empowerment requirements and targets, but offers
concessions to small businesses and foreign investors.39 In September 2007, Sasol,
the country’s oil and coal company, announced its intention to transfer 10% of the
company to black owners to qualify under BEE rules.
In the first decade of post-apartheid rule, analysts expressed concern over the
government’s ability to attract foreign investment at the levels needed to spur
growth. Sound macroeconomic policies, including reduced tariffs and export
subsidies, the loosening of exchange controls, improved enforcement of intellectual
property laws, and legislation designed to improve competition have been cited by
observers as responsible for the country’s current economic growth. A World Bank
study found that South Africa is one of the top 35 easiest countries in which to do
37 See, for example, “South Africa’s Black Companies Forge Ahead,” Africa Business, April
2006; “How SA’s Black Buying Power is Changing Society,” African Business,
August/September 2006; and “The Rise of the Buppies,” The Economist, November 1, 2007.
38 United States Department of Commerce, “Doing Business in South Africa: A Country
Commercial Guide for U.S. Companies,” 2006.
39 Multinational corporations can maintain 100% ownership provided they meet other BEE
criteria, including employment and procurement targets.

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business.40 Investors are, however, reportedly worried by labor relations, high crime
rates, and corruption. Transparency International ranks South Africa 54 out of 158
in its 2008 Corruption Perceptions Index, indicating that it is perceived as less
corrupt than other Sub-Saharan African countries (only three African countries
ranked less corrupt than South Africa), but more corrupt than many competitors for
investment in other parts of the world.41 Its ranking fell from 43 in 2007. Political
risks arising from regional instability, particularly in Zimbabwe, are regarded as
another deterrent to investors, and South Africa’s own racial, class, and political
divisions are seen as sources of concern. The resignation of President Mbeki has also
shaken investor confidence. Some studies suggest that business confidence is at it
lowest level in five years, due in part to instability in the global financial markets but
also because of concerns regarding in-fighting within the ANC.42
Some analysts have highlighted the country’s executive “brain drain” as one of
greatest threats to South Africa’s economic progress. They suggest that the outcome
of the debate over the role of state assistance may have the greatest effect on the
country’s capability to meet ASGISA goals, and consequently, the question of
presidential succession within the ANC may have significant ramifications on those
goals.
Electricity Shortages. The country’s continued economic growth may also
be threatened by an overstretched electricity network. In January 2008, South
Africans experienced severe electrical power cuts throughout the country. Estimates
indicate that the cuts may have cost the economy millions.43 The crucial mining
sector was hit particularly hard, causing global gold and platinum prices to rise.
Many mines closed for several days as the power cuts threatened worker safety.
Electricity from South Africa was also temporarily cut to neighboring countries.
State-owned Eskom, the world’s fourth largest power company, and the Mbeki
Administration blamed one another for the crisis. The government has begun
rationing electricity and is accelerating plans to build new power plants and
rehabilitate old ones. Experts suggest the shortages may nevertheless continue for
several years, and consumers now face steep increases in their power bills.44
40 See the Doing Business section of the World Bank’s website at [http://www.world
bank.org].
41 Berlin-based Transparency International describes itself as a non-governmental
organization devoted to combating corruption. The index is based on the reported
perceptions of business people and country analysts. A country with the rank of 1 has the
least corruption.
42 The Economist Intelligence Unit (EIU), Country Report September 2008.
43 EIU, “South Africa: Power Down,” January 31, 2008.
44 “South African Power Cuts Threaten Economic Growth; Jobs,” VOA News, January 31,
2008.

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U.S. Relations
U.S. policies toward South Africa and the anti-apartheid struggle were a
contentious issue from the 1960s through the 1980s, with many arguing that the
United States was doing too little to promote human rights and democratic rule.
Congress enacted the Comprehensive Anti-Apartheid Act of 1986 (P.L. 99-440) over
President Reagan’s veto in order to affirm U.S. support for democratic change. The
legislation imposed a number of sanctions against South Africa. The Reagan
Administration, by contrast, had been pursuing a policy of “constructive
engagement” (i.e., dialogue) with the white South African regime, regarding this
approach as the most effective way of promoting change.
In the early 1990s, the United States assumed a lead role in supporting South
Africa’s transition to democracy. Policy makers at that time saw the South African
democratization process as a model for other African countries, and expected that the
country would soon become a stabilizing force as well as an engine for economic
growth throughout the sub-Saharan region. South Africa’s need to focus on domestic
economic and social problems meant that U.S. expectations for the country’s regional
role were perhaps not met in full in the first post-apartheid years. But South Africa’s
leadership in the launching of NEPAD; the deployment of South African
peacekeepers to Burundi, Cote d’Ivoire, and Sudan; and intensive South African
involvement in the peace process in the Democratic Republic of the Congo have
highlighted South Africa’s capabilities as a regional actor. South Africa also assisted
U.S. efforts to resolve the Haiti crisis by providing an exile location for former
President Bertrand Aristide. Given South Africa’s role in conflict mediation and
resolution throughout the continent, the United States has worked to expand the
country’s peacekeeping abilities through the African Contingency Operations
Training Assistance (ACOTA) program.45
Since 1992, South Africa has been among the leading African recipients of U.S.
aid. U.S. assistance to South Africa has increased in recent years, rising from an
estimated $224 million in FY2006, to $398 million in FY2007. The Bush
Administration has obligated an estimated $574 million for FY2008, and has
requested almost $576 million for FY2009.46 In its FY2008 congressional budget
justification, the State Department reported that “the U.S. Government’s (USG)
relationship with South Africa is transforming from that of donor to one of strategic
partnership,” and accordingly, “activities in Peace and Security will continue to
increase in importance while development programs will be phased out in the next
couple of years.” U.S. assistance will continue to focus on fighting HIV/AIDS and
tuberculosis and assisting the South African government to implement economic
reforms and to improve its regional peacekeeping capacity. USAID programs have
supported efforts to promote sound governance, reduce unemployment and poverty,
45 For more information see CRS Report RL32773, The Global Peace Operations Initiative:
Background and Issues for Congress, by Nina M. Serafino.
46 On December 26, the President signed into law the FY2008 Consolidated Appropriations
Act (H.R. 2764/P.L. 110-161), which included State, Foreign Operations, and Related
Programs appropriations for FY2008. Country-specific allocations have not yet been
released.

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increase access to shelter and basic municipal services, and improve the quality of
education and the country’s health system. U.S. assistance includes $850,000 in
International Military Education and Training (IMET) programs in South Africa.
The United States provides significant assistance to South Africa’s fight against
HIV/AIDS through the President’s Emergency Plan for AIDS Relief (PEPFAR),
having contributed over $855 million since the program’s inception in FY2004. The
Administration has requested $557 million for FY2009 through the Global
HIV/AIDS Initiative. By the end of FY2007, the PEPFAR program had provided
ARV therapy to an estimated 329,000 patients, transmission prevention treatment to
over 333,000 pregnant HIV-infected women, and palliative and/or tuberculosis care
for 984,500 South Africans. PEPFAR’s South Africa program also funds public
education efforts to promote abstinence, faithfulness, and healthy behavior to reduce
the risk of transmission among high-risk groups.
The 110th Congress has taken steps to address lingering restrictions on U.S.
visas for members of the ANC, including former Presidents Mbeki and Mandela,
who were convicted under the previous apartheid government of crimes against that
regime. In May 2008, the House of Representatives passed H.R. 5690, sponsored by
House Foreign Affairs Committee Chairman Howard Berman. The legislation
removes the ANC from treatment as a terrorist organization, instructs U.S.
government agencies to remove any terrorist designations regarding the ANC and its
leaders from their databases, and gives discretion to the State and Homeland Security
Departments in determining admissibility of visa applicants based upon specified
criminal convictions or terrorist activities undertaken in opposition to apartheid rule.
Secretary of State Condoleeza Rice called the restrictions “embarassing.”47 Senator
John Kerry introduced companion legislation, S. 2979. Members of the 110th
Congress have also introduced legislation honoring Mandela, H.Res. 1090, and
Archbishop Desmond Tutu, H.Res 34.
Cooperation in Fighting Terrorism
U.S. and South African law enforcement authorities have cooperated for several
years on terrorism investigations, including investigations into the possibility that
South Africa has been used as a haven for Islamic militants from outside the region.48
In 1999, South African authorities arrested Khalfan Khamis Mohamed, a Tanzanian
later convicted in the bombing of the U.S. embassy in Dar es Salaam, and deported
him to the United States. Khalfan had reportedly sought to hide among Cape Town’s
Muslims after he fled Tanzania. More recently, one of the suspects of the 2005
London bombings, Haroon Rashid Aswat, who was arrested in Zambia, was thought
to have spent time in South Africa. There is continuing concern that other terrorists
47 “Congressman Wants to End U.S. Travel Restrictions against Mandela and the ANC,”
Voice of America, April 10, 2008.
48 “SA, US Work in Tandem to Find Terrorist Cells,” Business Day, December 11, 2002.

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may seek to hide in South Africa, or make use of its modern transportation and
communications systems for transit, smuggling, and money-laundering.49
The U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC)
includes several South African nationals in its Specially Designated Nationals List
(SDN), which sanctions individuals and groups believed to have links to terrorism.
In a controversial move, the South African government used its position in 2007 as
a member of the U.N. Security Council’s Al-Qaeda and Taliban Sanctions
Committee, also known as the 1276 Committee, to block United Nations travel and
financial sanctions on two of these individuals, Farhad Ahmed Dockrat and Dr.
Junaid Ismail Dockrat. The South African government argued that it required more
time to examine the evidence against the Dockrats before applying sanctions.
There is concern over the potential use of South African travel documents by
would-be terrorists. At the time of his arrest, Haroon Rashid Aswat was carrying a
South African passport, and according to media reports, others with suspected ties
to terrorism have been apprehended at U.S. and British borders, as well as in
Pakistan, with South African travel documents.50 The U.S. State Department’s
Office of the Coordinator for Counterterrorism has noted concern regarding
fraudulent travel documents, saying, “efforts to limit the accessibility of passports
and identity documents to potential terrorists are limited by resources and corruption
in the Department of Home Affairs.”51 South African passports were found during
raids by British police on suspected terror groups in London in 2004 and 2005.
South Africa’s intelligence minister reported in August 2005 that groups allegedly
linked to al-Qaeda had been discovered in southern Africa and that maritime targets
could be threatened. U.S. law enforcement agencies provide training to their South
African counterparts, supply needed equipment to the South Africa Police Service,
and share information.52
The South African government has expressed differences with the United States
in the latter’s designation of Hamas and Hezbollah as terrorist organizations. In May
2007, prior to the Hamas military seizure of the Gaza Strip, the South African
Minister of Intelligence met with Hamas leader and then-Prime Minister of the
Palestinian Authority Ismail Haniyeh. According to some media reports, he
publically praised Hamas and invited Haniyeh to visit South Africa.
49 “Spreading Influence: In South Africa, Mounting Evidence of al Qaeda Links,” Wall
Street Journal, December 10, 2002.
50 “Arrests and Plots Give South Africans a New Program,” New York Times, August 9,
2004.
51 U.S. Department of State, 2005 Country Reports on Terrorism [http://www.state.gov/s/ct/
rls/crt/2005/].
52 “Law Enforcement,” available at the website of the U.S. Embassy in Pretoria
[http://usembassy.state.gov/pretoria].

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Diplomatic Differences
Despite the cordial relations that officially exist between South Africa and the
United States, some analysts suggest that diplomatic differences highlight what U.S.
Assistant Secretary of State for African Affairs Jendayi Frazer has referred to as a
“rough patch” in U.S.-South African relations.53 As one U.S. official pointed out, the
country has had close ties with the Non-Aligned Movement countries, and has
exhibited “marked sympathy toward countries that exert their independence from the
West.”54 Some South African officials expressed opposition to the Bush
Administration’s initial proposal to locate a new U.S. combatant command, Africa
Command or AFRICOM, on the continent.55 In addition, South Africa has taken a
critical stance toward the war in Iraq, and former President Nelson Mandela has been
vocal in his opposition to what he views as U.S. unilateralism on Iraq. South Africa
also differs significantly with the United States on Iran. During an 2006 visit by the
Iranian Foreign Minister to Pretoria, South Africa affirmed its support for Iran’s
“inalienable right to pursue nuclear energy for peaceful purposes,” at the same time
that the Mbeki government announced its intention to consider renewing its uranium
enrichment program.56 South Africa, which dismantled its own nuclear weapons
program after the fall of apartheid, insists that any enrichment program would be
strictly peaceful in nature.
The United Nations. South Africa’s current role as a non-permanent member
of the U.N. Security Council has been controversial, and the South African
government has been criticized by the United States as well as by many human rights
activists for its lack of support for human rights issues raised before the Council.57
In January 2007, South Africa voted against a resolution on political prisoners in
Burma, arguing that alleged human rights abuses in sovereign countries are not
covered by the mandate of the Security Council as defined by the U.N. Charter. It
argued that because the abuses do not pose a direct threat to international peace and
security, they would be more appropriately addressed by the U.N. Human Rights
Council.58 In March 2007, while serving a one-month term as President of the
Security Council, South Africa reportedly blocked discussion of human rights abuses
53 Janine Zacharia, “U.S. Finds an Antagonist in a Country on the Rise,” International
Herald Tribune, June 27, 2007.
54 Remarks by Deputy Assistant Secretary of State Linda Thomas-Greenfield, “U.S.-South
Africa Relations: The View from Washington,” Washington, D.C., September 14, 2006.
55 According to South African media reports, in July 2007, the U.S. Ambassador to South
Africa, Eric Bost, publicly expressed frustration that the country’s defense minister would
not respond to requests for a meeting with General Kip Ward, commander of AFRICOM.
For more information, see CRS Report RL34003, Africa Command: U.S. Strategic Interests
and the Role of the U.S. Military in Africa, by Lauren Ploch.
56 “South Africa’s Support for Iran’s Nuclear Program ‘Holds Firm’,” BBC Monitoring
Africa, September 1, 2006.
57 See, for example, Colum Lynch, “South Africa’s U.N. Votes Disappoint Some,”
Washington Post, April 16, 2007; James Kirchick, “Why, the Beloved Country?,” Los
Angeles Times, July 29, 2007.
58 U.N. document, S/2007/14, January 12, 2007.

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CRS-20
in Zimbabwe.59 Nobel laureate Archbishop Desmond Tutu said of the Burma vote,
in which China and Russia cast a double veto, “I am deeply disappointed by our vote.
It is a betrayal of our own noble past...The tyrannical military regime is gloating, and
we sided with them. If others had used the arguments we are using today when we
asked them for their support against apartheid, we might still have been unfree,”60
Former DA leader Tony Leon expressed similar sentiments on his government’s
alleged refusal to address the Zimbabwe situation, calling it “extraordinary irony”
that the ANC government would use the same argument used to block debate on the
abuses of the former apartheid regime in South Africa.61
In July 2008, South Africa voted with Russia, China, Vietnam, and Libya in
opposition to a U.S.-sponsored resolution on Zimbabwe (S/2008/447) that called for
targeted sanctions on select members of the Mugabe regime, an international arms
embargo, the appointment of a U.N. Special Representative on Zimbabwe, and the
creation of a Panel of Experts to monitor and evaluate the situation and the effects
of the sanctions.
South Africa and the United States also have differed on Middle East issues
addressed by the Security Council. In May 2007, South Africa abstained from a
U.S.-sponsored resolution to establish an international tribunal to investigate political
killings in Lebanon, arguing that although it supported a tribunal with “Lebanese
ownership,” it was not appropriate for the Security Council to impose a tribunal upon
the country and “politicize international criminal law.”62 The country also has been
vocal in its opposition to Security Council sanctions on both Sudan and Iran, arguing
that such sanctions would ultimately harden the target governments’ positions rather
than reduce tensions. However, after efforts to modify resolution language, South
Africa ultimately did vote for sanctions against Iran in March 2007, “to remind Iran
of its responsibility towards the IAEA and the Nonproliferation Treaty.”63
Zimbabwe.64 Political and economic turmoil in neighboring Zimbabwe has
led to a massive exodus of Zimbabweans in search of work. Some sources estimate
that four million Zimbabweans (30% of the total population) are now living outside
the country. South African government sources reported a sharp increase in border
crossings after the Zimbabwean government implemented price controls on basic
59 “Britain Wants U.N. Security Council Attention on Zimbabwe,” Voice of America, March
16, 2007.
60 “Desmond Tutu ‘deeply disappointed with South Africa’s vote against U.N Security
Council resolution on Myanmar,”International Herald Tribune, January 21, 2007.
61 “South Africa Reportedly Blocking U.N. Debate on Zimbabwe Crisis,” Business Day,
March 20, 2007.
62 China, Indonesia, the Russian Federation, and Qatar also abstained. U.N. document,
S/2007/315, May 30, 2007.
63 U.N. Document S/Res/1747, March 24, 2007. For South African government statements
on the vote, see “Iran Keeps Up Nuclear Consultation with SA,” Business Day, July 9, 2007.
64 For more information on South Africa’s policies on Zimbabwe, see CRS Report RL34509,
Zimbabwe: 2008 Elections and Implications for U.S. Policy, and CRS Report RL32723,
Zimbabwe, by Lauren Ploch.

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CRS-21
commodities in June 2007. Zimbabwe’s other neighbors, Zambia, Botswana, and
Mozambique, also have seen a significant rise in immigration in the last year. While
many stay in these countries to look for work or stay with relatives, others commute
across the border daily to buy basic staples that are now unavailable in their own
country. Those who are caught by South African police are sent back to Zimbabwe;
the International Organization for Migration (IOM) reported that the number of
Zimbabweans repatriated from its facility in Beitbridge, South Africa increased from
40,000 in the last six months of 2006 to almost 118,000 in the first six months of
2007. As mentioned above, tensions over perceived competition for resources led
in May 2008 to xenophobic attacks on Zimbabweans and other immigrants in
townships throughout South Africa. Many were rendered homeless and forced to
seek shelter in temporary camps established by the South African government, while
others chose to return to their country of origin.
During his 2003 visit to Africa, President George W. Bush called then-President
Mbeki his “point man” on Zimbabwe.65 The United States has been outspoken in its
criticism of the policies of Zimbabwe’s President Robert Mugabe with respect to
human rights, democracy, and land reform, and has imposed “targeted sanctions”
prohibiting travel to the United States by Zimbabwe leaders. President Mbeki, by
contrast, chose to deal with President Mugabe through “quiet diplomacy,” or
diplomatic engagement, and South African officials have called for western countries
to reconsider the penalties they have imposed on Zimbabwe.
As Zimbabwe’s largest trading partner, many observers consider South Africa
to be in a position to exert substantial leverage on its neighbor. At the same time,
South Africa must weigh the unintended effects of such leverage — state collapse
across its northern border could produce a sharp increase in illegal migration and
have a substantial impact on South Africa. In 2005, as the International Monetary
Fund (IMF) threatened to expel Zimbabwe from the Fund for debt payment arrears,
the country requested a loan of up to $1 billion from South Africa for fuel, food, and
electricity, as well as to address the IMF payments. Amid rumors that the South
African government would make any potential loan conditional on economic and
political reforms, the loan negotiations stalled and Mugabe found another source
from which to repay the IMF dues.66
In March 2007, Southern African Development Community (SADC) leaders
appointed President Mbeki to mediate between the Zimbabwean government and the
opposition. In June 2007, South Africa initiated talks between the Mugabe
Administration, represented by the country’s Ministers of Labor and Justice, and the
two MDC factions, represented by their respective Secretary-Generals, in Pretoria.
President Mugabe’s proclamation in January 2008 that national elections would be
held on March 29, 2008, while opposition rallies in the country continued to be
suppressed by police, angered the opposition and led to the dialogue’s collapse.
65 Comments made by President Bush during press conference on July 9, 2003 in Pretoria
[http://www.whitehouse.gov/news/releases/2003/07/20030709.html].
66 “Zimbabwe Pays Part of IMF Debt,” The Washington Post, September 2, 2005.

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CRS-22
Following Zimbabwe’s 2005 parliamentary elections, which the British and
American governments termed “fundamentally flawed” and “seriously tainted,” the
head of South Africa’s parliamentary observer mission, Mbulelo Goniwe, chief whip
of the ruling African National Congress (ANC), was quoted saying that the
delegation had “unanimously agreed that the elections were credible, legitimate, free
and fair.”67 Leading the Southern African Development Community (SADC)
observer delegation, South African Deputy President Mlambo-Ngcuka congratulated
Zimbabwe on “the holding of a peaceful, credible, well-managed and transparent
election. The people of Zimbabwe have expressed their will in an impressively
instructive manner that will go a long way in contributing to the consolidation of
democracy and political stability not only in Zimbabwe, but also in the region as a
whole.”68 Both statements received substantial criticism in the international press.
Mbeki’s Zimbabwe policies drew criticism from within his country; former
President Mandela, Archbishop Tutu, former opposition leader Tony Leon, and even
the ANC’s ally, the Congress of South African Trade Unions (COSATU), have been
vocal detractors. COSATU delegations have been forcibly expelled from Zimbabwe
twice, first in 2004 and later in 2006, when COSATU members traveled to Harare
to express their support for Zimbabwean human rights activists after incidents of
alleged police violence. One COSATU leader remarked, “we are not quiet
diplomats,” and “we will not keep mum when freedom does not lead to respect for
workers and human rights.”69 When the Mbeki government issued a terse initial
statement following the March 11, 2007, arrest of opposition and civil society
activists, COSATU criticized the government for a “disgraceful” response, “in the
face of such massive attacks on democracy and human rights, especially coming from
those who owed so much to international solidarity when South Africans were
fighting for democracy and human rights against the apartheid regime.”70
ANC leader Jacob Zuma has referred to the Zimbabwean president as “a
monster,” but has defended Mbeki’s quiet diplomacy.71 Other ANC heavyweights
like Cyril Ramaphosa and Tokyo Sexwale have criticized Mbeki’s policy. Sexwale
has said, “When a freedom fighter takes a wrong step, it is time for other freedom
fighters to stand up and say ‘we know you are a great man, but we cannot support
what you are doing.’”72 In 2007, he suggested that the Zimbabwean government may
67 “The Real Fraud in Zimbabwe,” The Washington Times, April 6, 2005.
68 “Zimbabwe’s Enabler; South Africa Falls Short as Monitor of Democracy, The
Washington Post, April 4, 2005.
69 “We Are Not Quiet Diplomats,” Daily Mail and Guardian (Johannesburg), November 5,
2004.
70 “South Africa Ends ‘s ‘Silence’ on Zimbabwe, Urges Harare ‘to Respect Rule of Law,’”
BBC Monitoring Africa, March 14, 2007.
71 “I’m No Mugabe, but I Have Sympathy for What He Has Done,” The Sunday Telegraph
(London), November 26, 2006.
72 “Chorus of Disapproval Grows As Sexwale Speaks Out on Mugabe,” Zimbabwe
Independent, October 6, 2006.

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CRS-23
be ignoring Mbeki’s efforts, and that it may be time to “turn up the volume.73
Ramaphosa has expressed similar sentiments.
President Mbeki’s reluctance to take a more critical stance toward the Mugabe
Administration led to increasing calls for the South African leader to be replaced as
the SADC mediator on Zimbabwe. Tsvangirai criticized Mbeki for his “quiet support
for the dictatorship,” and has called for him to step down as mediator.74 According
to reports, President Mbeki recently wrote President Bush a letter warning the United
States not to interfere in the Zimbabwe situation.75 But as the violence increased
after the 2008 elections in Zimbabwe, public and internal ANC pressure may have
forced Mbeki to take a stronger position with President Mugabe. Mbeki visited
Zimbabwe on several occasions after the elections, and he dispatched six retired
generals to investigate reports of attacks on the opposition. The generals reportedly
expressed shock at the level of violence.76 Under Mbeki’s mediation, the Zimbabwe
parties reconvened for talks in South Africa, and on September 15, 2008, after
several weeks of negotiations, Mugabe and MDC leader Morgan Tsvangirai signed
a power-sharing arrangement aimed at resolving the political standoff. As part of the
deal, Tsvangirai would become Prime Minister, and cabinet positions would be
divided among the parties. In the weeks following the agreement, observers have
become increasingly skeptical that it will be implemented.
Trade
The United States and South Africa enjoy a strong trade relationship. The
United States leads the world in direct foreign investment in South Africa, with over
600 American companies active in the country.77 As Table 1 indicates, the United
States runs a deficit in its merchandise trade with South Africa. Nevertheless, South
Africa is the largest market for U.S. goods on the continent, with imports totaling
over $5.5 billion in 2007. Leading U.S. exports include transportation equipment,
chemicals, and electronic products, while leading imports include minerals and
metals, and transportation equipment.78 U.S. officials point out that South Africa
continues to enjoy major benefits from the African Growth and Opportunity Act
(AGOA, P.L. 106-200), enacted by Congress in May 2000, with nearly all of the
country’s exports qualifying for duty-free entry into the United States. Through
AGOA, South Africa exported $2.3 billion in such products as vehicles, chemicals,
minerals, metals, and agricultural, textile, and apparel products in 2007, making the
country the largest and most diversified supplier of non-fuel products under AGOA.
73 “Zimbabwe ‘Ignoring’ SA Diplomacy,” BBC, May 15, 2007.
74 Barry Bearak, “Zimbabwe Opponent Criticizes Mbeki,” New York Times, February 14,
2008.
75 Michael Gerson, “The Despots’ Democracy,” Washington Post, May 28, 2008.
76 “Anxiety Grows for Kidnaped Zimbabwe Activist,” Voice of America, May 18, 2008.
77 Europa Regional Surveys of the World, Africa South of the Sahara 2006, 35th ed.
Routledge, London: 2005, p. 1098.
78 U.S. International Trade Commission.

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CRS-24
Table 1. U.S. Merchandise Trade with South Africa
($ billions)
2003
2004
2005
2006
2007
Exports to South Africa
2.819
3.178
3.907
4.462
5.518
Imports from South Africa
4.624
5.945
5.886
7.501
9.075
Balance
-1.805
-2.766
-1.979
-3.039
-3.557
Source: U.S. Census Bureau, Foreign Trade Division
During a 2002 visit to South Africa, U.S. Trade Representative Robert Zoellick
proposed the creation of the United States’ first free trade agreement (FTA) with sub-
Saharan Africa, linking the United States with South Africa and the other members
of the Southern Africa Customs Union (SACU): Botswana, Lesotho, Swaziland, and
Namibia. SACU is the United States’ second largest trading partner in Africa behind
petroleum-rich Nigeria. Reaction to the FTA proposal in the region was reportedly
positive, but there were concerns about the scope of the negotiations. Some
observers felt that U.S. proposals to include intellectual property, government
procurement, and services in the negotiations could have a negative impact on the
SACU countries, and that the United States was not sensitive to the differing levels
of development within SACU. Negotiations began in 2003 but were suspended in
2006, when U.S. and SACU officials agreed on a new work program that will aim
to address a broad range of trade and investment issues, and may contribute in the
long term toward a possible FTA. Analysts suggest that the momentum for SACU
negotiators to complete the FTA may have been lost, given that AGOA benefits were
extended through the AGOA Acceleration Act of 2004 (P.L. 108-274) until 2015.79
Prospects for the Future
Analysts seem generally confident that South Africa will remain politically
stable for some time to come, although concerns regarding ANC in-fighting have
increased. There are tensions in rural areas over land, but South Africa seems far
from a rural upheaval over the issue, as has been the case in Zimbabwe. Social
tensions over perceived inequalities in the distribution of wealth and inadequate
service delivery, which resulted in violent attacks on African immigrants in mid-
2008, are likely to continue in the near term as the government struggles to address
the needs of its poorest citizens. South Africa’s longer term stability is linked to the
success of the South African government and its partners in fighting poverty and
reducing the toll of the AIDS pandemic.
The principal worry for some analysts has been that South Africa will become
a de facto one-party state under the ANC, weakening checks and balances in the
79 For further information, see CRS Report RS21387, United States-Southern African
Customs Union (SACU) Free Trade Agreement Negotiations: Background and Potential
Issues, by Danielle Langton.

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CRS-25
political system. Should this happen, some fear that the regime could become
increasingly authoritarian and unresponsive to the needs of its citizens. ANC leaders
reject this view, arguing that their party is a national liberation movement committed
to transforming South Africa and fulfilling the aspirations of the poor.80 Others argue
that the power of the ruling party is limited by the country’s free and very active
press, independent judiciary, and a bill of rights enshrined in the constitution. Some
reports suggest that public confidence in the ANC’s commitment to the rule of law
has been shaken by recent policy decisions and judicial actions. In any event, ANC
leaders want their country to be seen as a leader in Africa, and as a spokesman for
Africa and developing countries generally in world affairs. To play such roles, South
Africa must continue to be recognized as a successful democracy.
Figure 1. Map of South Africa’s Provinces
ZIMBABWE
South Africa -
MOZAMBIQUE
Provinces
NORTHERN
PROVINCE
BOTSWANA
MPUMA-
NAMIBIA
Pretoria
LANGA
NORTHWEST
GAUTENG
SWAZILAND
FREE
KWAZULU-
STATE
NATAL
LESOTHO
NORTHERN
CAPE
AT L A N T I C
EASTERN
O C E A N
CAPE
WESTERN
I N D I A N
CAPE
O C E A N
Source: Map Resources. Adapted by CRS. (12/02 M.Chin)
Note: South Africa shaded; all unshaded areas are independent countries
80 See, for example, President Mbeki’s December 16, 2002 address to the ANC national
conference [http://www.anc.org.za/ancdocs/history/mbeki/2002/tm1216.html].

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