How South Africa’s Corruption Makes It Vulnerable to Foreign Infiltration

Excerpt

Johannesburg is broke—and broken. Just months after it hosted the G20, the premier forum for global economic cooperation, South Africa’s largest city cannot afford to pay its bills, mayoral candidate Helen Zille revealed on May 6. Johannesburg is not an outlier: corruption and mismanagement pervade South Africa.

South African corruption poses a real threat to US interests. The country is a leading producer of critical minerals globally. Nefarious actors such as China, Russia, or Iran could exploit South Africa’s debt issues to strengthen their positions at Washington’s expense. For example, a group of 160 lawyers called upon the United States to determine whether Iran paid off the ruling African National Congress (ANC) party’s debt as a bribe to get South Africa to launch a case against Israel at the International Court of Justice.

South Africa is also a titan in banking on the African continent, a service industry particularly vulnerable to fraud. Although the Financial Action Task Force (FATF), the world’s leading anti-money laundering intergovernmental agency,removed Pretoria from its grey list of jurisdictions of concern in October 2025, South African financial and corruption woes merit revisiting the issue.

South Africa’s finance minister wrote to Johannesburg’s mayor on April 23, warning that the city is effectively bankrupt. Johannesburg owes more than $1 billion to creditors but has only $200 million in liquid assets. Ahead of the G20 summit in November 2025, the mayor signed a two-year, $630 million salary deal with the South African Municipal Workers’ Union to mask the city’s dysfunction. The finance minister ordered the mayor to halt the deal.

David May is the research manager and a senior research analyst at the Foundation for Defense of Democracies (FDD), specializing in economic warfare. Theodore Schneiderman is an intern at FDD.