Photograph Source: U.S. Department of State – Public Domain
Last week, Pres. Trump issued an Executive Order targeting South Africa (SA). In terms of this order, the United States (US) immediately cut all aid to the country and granted refugee status to white citizens of Afrikaner descent. This was ostensibly done because SA had enacted legislation, principally the Expropriation without Compensation Act, which allegedly discriminates against Afrikaner South Africans and had harmed US interests by taking ally Israel to the International Court of Justice on genocide charges against the Palestinian people.
A review of local media commentary and analyses thereon in the days that followed suggests that local analysts accept the reasons that Pres. Trump has put forward for passing this Executive Order although they disagree on the legitimacy of the grounds and the accuracy of the information upon which he based his decision. Indeed, coming as his decision did after the slew of social media posts that Pres. Trump has posted about SA over the years and growing tension between SA and the US government caused by, amongst others, alleged SA military support for Russia in its war against Ukraine, one can detect a certain degree of smugness amongst many self-appointed political pundits and armchair critics of the government who have supposedly warned SA that its policies were on the radar of the US government.
Although some commentators have speculated on the influence which South African born billionaire Elon Musk might have exerted on Pres. Trump, the possibility that factors other than seemingly altruistic diplomatic and humanitarian concerns may be driving Pres. Trump’s decision has not received much consideration, notwithstanding the markedly mercantilist tone which he has struck in pronouncements during the first month of his second term as president. In a bid to address this oversight, the following article explores a possible commercial dimension to this decision. Specifically, it will focus on the possibility that US commercial interests in South Africa’s nuclear industry and the access this could afford to Africa’s potentially lucrative nuclear energy market in future underlies this decision.
Before examining how this Executive Order and the issuing of threats of further action if SA does not reverse its policy course might serve to advance American commercial nuclear interests, it might be useful to recap some broad trends that can be discerned in the African nuclear energy market. Chief of these is the anticipation that the long-promised Nuclear Renaissance may finally be getting underway driven by the need for countries to reduce their carbon emissions and transition their economies away from dependence on fossil fuels for their energy needs. African countries, with their younger growing populations, low energy output and weak economies, in particular, appear to have embraced this solution to reducing their carbon footprint, judging at least by the number of African countries that have either embarked upon nuclear programmes recently (e.g. Egypt) or began planning to establish them in earnest (e.g. Kenya,Ghana). Nuclear technology vendor countries have, in turn, recognised the increased economic opportunities available in Africa’s nuclear energy sector and have been eager to partner with African countries to help them realise their nuclear ambitions. Subsequently, the African nuclear energy market has become an arena for increased competition and contestation for influence at a time of heightened geopolitical tensions globally. Seen against this backdrop, it is reasonable to assume that strategists would perceive that the US would be able to thwart Russian and Chinese nuclear ambitions and gain an advantage over its Great Power rivals in Africa’s nascent nuclear energy market by securing greater access to BRICS member South Africa’s nuclear energy sector given South Africa’s status as a uranium-producing country with a well-established nuclear industry that has a significant pool of nuclear expertise and skills.
Granted, reasonable objections could be made that developments in the South African energy market do not support this hypothesis. For instance, with state-owned electricity utility ESKOM having apparently brought loadshedding (the euphemism officially used to describe rolling blackouts in SA) under control for the better part of a year and many private companies and individual consumers that can afford it having already migrated off the electricity grid by installing solar electricity for example, the South African government’s appetite for increasing nuclear capacity is likely to have waned. At the political level, support for expanding nuclear power capacity is unlikely to be guaranteed among the reluctant partners that make up the unsteady Government of National Unity that was established last year after none of the political parties managed to secure a majority of votes in last year’s national elections. Coupled with the fact that this controversial decision has been tainted by allegations of bribery and corruption and is thus likely to be met with significant popular opposition despite the expansion of nuclear power capacity being gazetted in the government’s latest (draft) Integrated Resource Plan, all but the most ardent nuclear supporter would be bullish about the prospects of government expanding nuclear power output. Furthermore, even if the South African government did decide to go ahead and expand nuclear power capacity, indications are that BRICS ally Russia has always been the frontrunner to secure any nuclear deal with SA. Therefore, it would appear that there exists little direct benefit for the US to apply pressure on SA in this regard.
Although these objections are valid, they may not be relevant to US nuclear plans given the segment of the nuclear market on which the US appears to be focused and the model of energy service provision it appears to favour. Rather than the large-scale power plants which have traditionally been the focus of nuclear buildouts, the US has been pushing the design and development of small modular reactors (SMRs). Importantly, since they are smaller than traditional nuclear power stations, in terms of output capacity, and estimated to cost substantially less (although disputed), public entities are not the only potential buyers of these reactors. Moreover, since they can be located in remote locations, they do not have to be connected to the public electricity grid, thus enhancing their appeal for use in energy-intensive operations such as mining operations located in countries where electricity supply is often erratic given the poor state of transmission infrastructure.
The US government’s outlook for the nuclear industry happens to dovetail with the needs of the tech entrepreneurs who appear to constitute Pres. Trump’s inner circle. Incidentally, these tech moguls have themselves invested heavily in thedevelopment of advanced SMRs to meet the energy needs of the energy-hungry datacentres on which the Artificial Intelligence industry is reliant. Incidentally, they have already raised significant amounts of capital to build nuclear power stations based on SMR designs. Access to South Africa’s nuclear industry would enable them to build out the large energy infrastructure needed to run their datacentres cost-effectively while also enabling them to test and hone their preferred model of independent electricity production before replicating it elsewhere.
In a further twist, Afriforum, the group that has been thrust into the global spotlight because of its central role in this saga following its lobbying on behalf of Afrikaners in the US, and its various partner organisations in SA, e.g. Southern African Agri Initiative (SAAI), are prominent supporters of nuclear power and have long been proponents of SMR designs based on South Africa’s abandoned pebble bed modular reactor design. This group has also partnered with US based organisations that have deep South African links to raise funds in the US for the building and operation of SMRs in SA. Building and operating nuclear power stations that enable users to provide for their own energy needs accords well with this group’s political ideology of a weak central state and the creation of a series of autonomous communities that are generally self-reliant.
All that advancing US government and these parties’ joint interests in this part of the SA nuclear energy market would require is a change in policy on the part of the SA government to permit private electricity consumers to run nuclear power stations for their own electricity needs, not the outlaying of vast sums by a public company to build nuclear power stations using US nuclear technology or a long-term commitment to partner with US nuclear vendors to build and operate these facilities. In a final twist, the South African government is currently in the midst of a major overhaul of its energy policies to facilitate greater private sector participation in its energy sector. Speculatively, these actors may have calculated that the threat of further action from Pres. Trump, e.g. the stripping of South Africa’s benefits under the Africa Growth and Opportunity Act, may be sufficient to force the South African government to placate the US by acceding to their nuclear demands.
It is put to the reader that this background informs Pres. Trump’s recent decision to target SA. Based on this alignment of interests between the US government, tech billionaires and influential Afrikaner lobby groups, it is further asserted that the pressure being applied on the South African government is motivated in significant part by US commercial interests in South Africa’s nuclear energy industry.
