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The reason behind the Rand’s sharp fall in the past two days was revealed in spectacular fashion today when the US’s ambassador to South Africa, Reuben Brigety, told journalists that the country has broken the international arms embargo by providing weapons and ammunition to Russia.
This comes on the heels of disclosures that former SA president Jacob Zuma’s daughter Duduzile led a campaign on Twitter supporting Russia’s invasion of Ukraine.
The Rand lost 30c on the embargo-breaking accusation to breach R19.20 against the Greenback. This surpasses the previous all-time low of R19.03 on 24 April 2020 during the early days of the Covid pandemic.
SA is heavily dependent on special treaties allowing duty-free access into the American and European markets, where it sells the bulk of its exports.
Our UK partners, the Financial Times of London, reported this afternoon that United States has accused South Africa of covertly supplying arms to Russia in a covert naval operation. This has exacerbated a foreign policy crisis for President Cyril Ramaphosa over the country’s ties to the Kremlin and its stance on the Ukraine war.
US ambassador to South Africa, Reuben Brigety, made the allegations in local media on Thursday, stating that the US believed weapons and ammunition were loaded onto a Russian vessel, the Lady R, at a dockyard in Simon’s Town near Cape Town in December 2022.
South Africa is non-aligned in the Ukraine war, but Ramaphosa’s government has come under pressure over evidence that it is favouring Russia, such as by holding joint naval exercises this year.
Ramaphosa has also invited Russian President Vladimir Putin to attend a Brics leaders’ summit in Johannesburg in August, which has backfired after the International Criminal Court indicted Putin for war crimes.
The scandal over the Lady R is now likely to overshadow Ramaphosa’s efforts to explain South Africa’s stance and to try to preserve trade links.
SOURCE:Rand plunges to new low after US accuses SA of supplying arms to Russia – BizNews.com
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