Rand Plummets To Record Low After US Accuses South Africa Of Supplying Weapons To Russia

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by Tyler Durden
Thursday, May 11, 2023 - 04:20 PM

The US ambassador to Pretoria accused South Africa of supplying arms to Russia in a covert naval operation, sharply escalating a foreign policy crisis for President Cyril Ramaphosa over the country’s ties to the Kremlin and its position on the Ukraine war.

While the accusation was unconfirmed as of Thursday morning, the news sent the South African rand plunging to a new all time low while the benchmark stock index slid 1% and yields on 2032 government bonds soared 30 basis points to the highest since the start of the pandemic as any evidence that he country is defying international sanctions to support Russia’s invasion of Ukraine would make South Africa itself subject to international repercussions that would further sink an economy already under strain from unprecedented power shortages

According to the FT, Reuben Brigety, US ambassador to South Africa, told local media on Thursday the US believed that weapons and ammunition was loaded onto the Lady R, a sanctioned Russian vessel that docked in the Simon’s Town naval dockyard near Cape Town in December.

Lady R ship. Source: MarineTraffic

“Among the things we noted was the docking of the cargo ship… which we are confident uploaded weapons and ammunition onto that vessel in Simon’s Town as it made its way back to Russia,” he said, in comments reported by South Africa’s News24.

“The arming of the Russians is extremely serious, and we do not consider this issue to be resolved,” he added. The US embassy and South Africa’s foreign ministry did not immediately respond to requests for comment. Ramaphosa’s office said it would respond “in due course”.

South Africa has said it is non-aligned in the war, but Ramaphosa’s government is already under pressure over signs it - along with most non-western nations - is favoring Russia, for example by holding joint naval exercises this year.

Ramaphosa has also extended an invitation for Russian president Vladimir Putin to attend a Brics leaders’ summit in Johannesburg in August - a move that has backfired on Pretoria after the International Criminal Court indicted Putin for war crimes. South Africa, a member of the ICC, would be legally obliged to arrest Putin if he travels there.

Sydney Mufamadi, Ramaphosa’s national security adviser, recently visited the US to explain South Africa’s stance and to try to preserve trade links.

According to the FT, the scandal over the Lady R is now likely to overshadow these efforts. Owned by Transmorflot, a company placed under sanctions by the US last year, the Lady R appeared to switch off its transponder as it made the stop in Cape Town after a voyage down the west coast of Africa.

After the ship left port, South Africa’s defence minister said it had delivered a consignment for the country’s defense forces, but provided no details on what the ship may have picked up in Cape Town.

The South African government in January officially denied that it had approved any arms sales from South Africa to Russia since Moscow began its full-scale invasion of Ukraine in February last year.