The story of a South African firm

In this edited extract from their book, Ethnicity, Inc., Jean and John L. Comaroff, explore the epic story that is the rise, and rise and rise again of the business of the Royal Bafokeng Nation.

 

The Bafokeng, a Tswana nation situated in the North West province of South Africa, are a people made wealthy by platinum; a people whose kings are spoken of as CEOs; a people who are actually referred to by the mining industry and the mass media as “Bafokeng, Inc.”, and sometimes as “the richest tribe in Africa”. Their preferred designation, however, is “Royal Bafokeng Nation” (morafe). The history of their incorporation, an extraordinary epic by any measure, has its genesis more than a century-and-a-half ago, long before the dawn of the Age of Platinum.

It begins with land – specifically with the loss of Bafokeng territory to the expansion efforts of white settlers from the late 1830s onwards. These settlers were part of the northward migration of some 10,000 Boers, forebears of the modern Afrikaners, whose so-called Great Trek apartheid historiography typically ascribes to a heroic effort to escape British colonial control. Its motivation and consequences are still a matter of bitter contention and will no doubt be debated for as long as the “new” South Africa takes to re-write its past from the vantage of the postcolony. But what is indisputable is that, between the early 1840s and the mid-1860s, the Bafokeng, whose ethno-history goes back to the 12th century, were rendered effectively landless.

The modes of expropriation deployed by the Boers will be readily familiar to anyone with even a rudimentary knowledge of other settler colonialisms: a proclamation of suzerainty over large tracts of land by right of conquest after the defeat of “warlike” tribes in the region; the reduction of the commonage of local peoples to privately owned farms; and the enactment of racially grounded laws, under the First Boer Constitution of the Transvaal Republic (1844), which debarred “natives” from “any right to possess immovable property in freehold”. So bereft were the Bafokeng of a lebensraum that, by the late 1860s, in order to survive at all, they were compelled to rent farms from the very people who had dispossessed them.

Yet, the Bafokeng by this time had considerable experience with the cash economy, Christianity and colonialism, and they were decidedly forwardlooking in their understanding of the changing face of the subcontinent. With the connivance of Christian evangelists – a Hermannsburg mission had been established in 1867 – the Bafokeng Chief, Mokgatle Thethe, went quietly about buying up settler farms. To avoid legal restrictions imposed on African land ownership, the chief elicited the proxy of two German missionaries: the farms were registered in their names. To pay for them, the Bafokeng relied on income earned as agricultural labourers on white farms. Patently, however, this source of capital accumulation was never going to be sufficient unto their ambitions, a cold fact that might have put an end to the scheme.

bafokengBut, toward the end of the 1860s, diamonds were discovered in the South African heartland, not too far to the south. With the rapid growth of the diggings in and around Kimberley, Mokgatle seized the opportunity to send young men as contract workers, had them deposit a portion of their wages – £5 per contract to be precise – into a designated fund, and used the cash to execute a long string of real estate transactions.

There are a number of addenda to this early part of the story, some minor and some major, but none of them alter its gist from the vantage of Chief Mokgatle’s people, culminating in 1913 with the notorious Natives Land Act, which made it extremely difficult for blacks to acquire any more freehold. Through all of this, however, Bafokeng territory continued to be recognised as “immovable property” owned outright by “the tribe” under the trusteeship of the state.

This recognition was to lay the foundation for the emergence, many decades later, of the Royal Bafokeng Nation qua “ethnic corporation” – a consolidated land mass of some 2000 sq km that today is home to approximately 300,000 people living in 29 villages. As in all Tswana polities, belonging here is reckoned in the first instance by patrilineal descent, although outsiders may be and have long been absorbed into the morafe at the pleasure of its ruler.

The late colonial history of South Africa was to present the Bafokeng with new difficulties arising out of their real estate, although their 19th-century exertions – by establishing them “as a private, corporate owner” – would enable them to defend it when the going got tough. In 1924, the Merensky Reef was discovered beneath their territory: a layer of rock in the Bushveld Igneous Complex, it is said to contain much of the world’s supply of platinum group metals, along with rich deposits of chromite and graphite. The announcement led to a frantic scramble for mineral rights, to a lot of unscrupulous deal making, and in the end, to resort to the law on the part of the Bafokeng to safeguard their interests.

For all the scramble for contracts, little platinum mining was actually done until the 1960s, apparently because it was expensive and technically difficult. But advances in modes of extraction and rises in the price of the metal, especially with its use in exhaust pollution control, changed that. In 1968, the Impala Prospecting Company, a subsidiary of Gencor, itself a major player in the emerging “Afrikaner capitalist class”, entered into a prospecting accord with the Bafokeng. Nine years later, having concluded that the venture would be profitable and having gone through the bureaucratic steps to obtain the necessary permits, Impala Platinum (Implats) took up leases on two mining areas.

Under the contract, which was negotiated on behalf of the Bafokeng by a minister of the national government, putatively with their approval, the “tribe” was to be paid 13 percent of the taxable income that accrued to each operation. Such royalty agreements are notoriously open to manipulation on the part of mining companies: apart from all else, they can determine distributions by calculating their “taxable income” in a variety of ways. In the event, the Bafokeng only received their first revenues in 1978. Moreover, their remuneration was fairly paltry relative to shareholder dividends. By the mid-1980s, their king, Edward Lebone Molotlegi I, was far from satisfied with the prevailing arrangements.

When the company approached him in 1985 with a request to open up a third area, known as “the Deeps”, he demanded an adjustment to the contract. Implats agreed to raise royalties to just under 15 percent and, after a prolonged exchange about previous compensation, added a one-off payment of R4.5 million.

At more or less the same juncture, King Lebone concluded a deal with another company, Bafokeng Minerals, of which the Bafokeng and their ruler owned 25 percent, for the right to mine the new site. This led to conflict with Impala, which appealed to the Bophuthatswana government – the administration of the ethnic “homeland” (bantustan) created for the Tswana in the 1970s by the apartheid regime – to support it in its dealings with the monarch. Initially, the difference was over valuable geological research findings about platinum deposits in the area that Bafokeng Minerals wanted from Implats in order to open its operation at “the Deeps”.

But it hardened into a struggle over mineral rights between the “tribe” on the one hand and the mining company and bantustan authorities on the other. Inevitably, all parties resorted to law fare. The outcome was devastating to the Bafokeng. The judge ruled, perversely, that, far from being “corporate private owners”, they did not possess the land at all: that Lucas Mangope, the president of Bophuthatswana, in his capacity as head of state, had taken over the authority to administer it from the former South African minister of Bantu affairs. It did not help that King Lebone Molotlegi despised Mangope, to whom he referred as the “Dog of the Boers”.

And then there was an attempted coup.

In early 1988, an effort was made to overthrow President Mangope by the leader of the opposition People’s Progressive Party of Bophuthatswana, Rocky Malebana-Metsing. The coup failed, however, not least because Malebana-Metsing, who wanted to avoid bloodshed, forewarned the South African authorities about it, asking them not to intervene. This request, of course, they ignored by dispatching their military. As a result, the uprising was quelled. For the Bafokeng, and for Bafokeng, Inc., the failed rebellion had a deep down-side. Perhaps because its instigators were all allegedly from this “tribe” – whose ruling lineage was known never to have favoured the creation of a Tswana homeland – King Lebone was accused of being a “pioneer of the coup”. Serially harassed, interrogated, briefly incarcerated and under sustained threat, he fled to Botswana.

In the vacuum opened up by his absence, Mangope connived to have Lebone’s compliant younger brother, Mokgwaro, installed as ruler, to sideline the powerful wife of the exiled king by resort to repeated intimidation, and in 1990, to sign a contract on behalf of the Bafokeng with Implats. What followed was a decade of exquisitely Byzantine lawfare. The exiled King Lebone and his people took action against Bophuthatswana and Implats – both of whom retaliated by whatever means they could. These struggles were played out against the backdrop of the end of apartheid, a second, successful uprising against Mangope, the return and death of the monarch, and a corporate merger between Impala and Lonrho, the large British company.

Suffice to say that, in 1999, a settlement was finally reached. It specified that the Bafokeng would receive 22 percent of taxable income on operations in all areas; that a minimum of 1 percent of the gross selling price of all metals mined on their terrain would be paid to them; that they would be allocated a million shares in Impala Platinum Holdings, an equity stake worth R100 million; and, finally, that they could nominate a person to the board of the company. This, after the strenuous efforts of Implats to contest their ownership of the land, to subvert them as an active corporate partner and to minimise any and all payments to them, was a comprehensive victory for the Bafokeng. It had been a bitter battle, not just about minerals but about racial capitalism itself.

The road, if not to freedom then certainly to a platinum fiefdom, had been long indeed. But, in the end, the money spent all those years ago to repossess the land had paid off handsomely. True, the social costs accrued along the way were exorbitant. So, too, were the costs of lawfare, largely because, under apartheid, the law was rarely fair. On the other hand, so adept at it did the Bafokeng become that, as one journalist put it: “their ‘traditional weapon’ is now litigation, not the knobkierrie”.

From the time of the watershed victory over Implats, the growth of Bafokeng, Inc. – the nation, that is, in its commercial aspect – has been little short of breathtaking. Already in 1999, Enterprise, an industry magazine, referred to this “ethnic corporation” as a “major business”, reported its diversification into eight large-scale ventures and commented approvingly on the management executives that it had hired. Note here the simultaneous separation and blurring of morafe and company, at once the same thing and, sociologically and administratively, distinct; the point will turn out to be crucial.

Soon after, Mining Weekly, noting that mineral royalties had paid for extensive infrastructure in the kingdom – such as tarred roads and bridges, water reservoirs and reticulation, civic buildings and clinics, electricity and educational facilities – spoke of the Bafokeng as “a living example of African business acumen and black empowerment”. It gave as collateral evidence the fact that they had established such medium-sized concerns as Bafokeng Civil Works, Bafokeng Brick and Tile, Bafokeng Chrome, Phokeng Bakery, and Bafokeng Plaza – a shopping centre – and were actively looking for further business opportunities.

These they have found, in plenitude. The Royal Bafokeng Nation (RBN) has accumulated substantial stakes in, is paid royalties by, or otherwise benefits from a hugely complex array of enterprises. This goes back to before the legal settlement with Implats: in 1996, it bought its first large firm, Murray Construction – renamed Bafokeng Construction – and, with it, acquired several substantial contracts, including one to upgrade Durban Harbour and another to build the Bakwena Platinum Corridor, together worth R4.2 billion. The company was to be liquidated six years later in order to “distribute its assets among small businesses run by members of the community, [thus] to make way for the emerging construction industry within [Bafokeng]”.

In 1998, the RBN established a profitable joint venture with Mobil Oil SA, a subsidiary of Exxon. In 2001 Bafokeng, Inc. purchased 22 percent of the listed company SA Chrome and Alloys, an equity holding of R100 million; later, its stake was to grow to just under 35 percent – whereupon SA Chrome became Merafe Resources.
Merafe also has a joint venture with the signature Swiss corporation, Xstrata, the premier producer of ferrochrome on the planet. Then, in 2002, the RBN reached agreements with two mining conglomerates to open up new operations – the first with Anglo- American Platinum (Anglo Plat), the world’s largest platinum concern, and the second with Rustenburg Platinum – in both of which it obtained a 50 percent share, each valued at R2 billion. By 2004, its mining contracts with its two major partners, Implats and AngloPlats, netted $65 million.

Nor is this the end of the story. Take 2005: in April, Royal Bafokeng Finance purchased 10 percent of SA Eagle Insurance from Zurich Financial Services, a Swiss-based multinational; in August, it took over 20 percent of Astrapak, South Africa’s secondlargest packaging business, and 51 percent of Concor Holdings, a concrete manufacturer; in October, it acquired Fraser Alexander, a mining services company with operations both in southern Africa and in Chile.

And, under the national policy of Black Economic Empowerment (BEE), it became the “empowerment partner” in Impala Refinery Services, a subsidiary of Implats, taking a 49 percent stake, worth R5 billion. Nine months later, the RBN was to take yet another great leap forward, again at the hands of Implats, which decided to pay it R10.6 billion, equivalent to all future platinum royalties owed. This was to be converted into 9.4 million shares, which made the Bafokeng the largest stockholder in the company.

There have been numerous other deals, but it is hard to keep up. The business of Bafokeng, Inc., its diversified portfolio recently estimated at R20 billion, seems to expand with every passing month.

Government of the RBN, like the protection of its sovereign concerns, is vested in the kingship and its executive, legislative and judicial institutions. In this regard, it is like all other Tswana polities. With one exception: kgosi, the vernacular term here for king, is translated in those other polities as chief. The difference, patently, reflects the singular wealth and stature of the Bafokeng. Their monarchy, a dynastic patriline, sits at the apex of a morafe consisting of 72 wards spread across the 29 villages. Each falls under a hereditary headman (kgosana), who, in turn, is assisted by one or two wardmen (bannakgotla).

These personages together compose a Council of Headmen, with which the king meets regularly to discuss public affairs. The Executive Council and Council of Headmen combine in the Supreme Council, which formally comprises the Bafokeng legislature. Among other things it is a forum of public oversight: in the long-standing spirit of indigenous democracy, even the intricate financial manoeuvres of the Bafokeng money managers are presented to this gathering for cross-questioning, comment and critique.

Although the bureaucratic side of everyday governance is entrusted to the Royal Bafokeng Administration, the real corporate engine of Bafokeng, Inc., the source of its income stream, is Royal Bafokeng Holdings (Pty) Ltd (RBH). This ethno-national corporation, centred in Johannesburg, is run much like other global finance houses with fiduciary responsibility to its shareholders. Although it reports to the morafe, it is staffed by a CEO and money managers who would be at home in any boardroom in the world. Other than three white executives and current Bafokeng King Leruo, who is chairman of the company, its senior personnel include four Tswana directors – none of whom are Bafokeng royals, but lawyers and accountants, all trained in South Africa and with substantial business experience on the national scene.

In overseeing the Nation’s business operations, RBH is an umbrella for four subsidiaries – Royal Bafokeng Industrial Holdings, Royal Bafokeng Resources, Royal Bafokeng Management Services and Royal Bafokeng Finance – each of which looks after the companies, investments and interests relevant to its domain. At one point in time, Royal Bafokeng Resources was said to be heading for a listing as a public company on the stock exchange. Were it to do so, the Bafokeng would become the ultimate ethno-prise, one in whose finances and futures it would actually be possible to purchase shares.

As this suggests, the Royal Bafokeng Nation has become an ethnic brand of sorts. Bafokeng business has clearly taken off into the realms of mainstream mega-enterprise. It remains, however, rooted in communal capital. As the Royal Bafokeng Nation itself puts it, Bafokeng is “a traditional community that is leveraging corporate investments and participation in the bigger economy to meet its developmental needs, without losing its traditional footing”.

That, precisely, is the logic of the logo. Its visual image, the crocodile, totem of the morafe, was chosen because ostensibly it symbolises an “awakening in nature” and “the long journey of Bafokeng heritage”. It is the “signature” of their corporate being, at once located in the vernacular yet “global [in its] feel”. Perhaps a tad too global: two multinational companies, Singapore Crocodile International and Lacoste clothing, are already engaged in an acrimonious legal tussle in the Chinese courts over rights to use the same animal in their trademarks. The question arises here of who benefits from the ethno-branding, the incorporation of identity and the accumulation of capital? And what impact has it had on belonging?

Thus far, the strategy of the Royal Bafokeng Nation has not been to distribute its income to its ethno-citizenry as individuals, families, kinship groups or any other. It has, instead, invested it and spent it in the name of the morafe. Hence the strong focus on development and infrastructure and job creation, including a bursary initiative – for which R30 million has been allocated – to support those who, after completing high school, seek to further their education or vocational training in anything from hairdressing to advanced physics.

There is, however, considerable debate within and beyond the RBN about the deployment and distribution of its assets. The Policy Gap, a study of the platinum boom in the North West published in August 2007 by the Bench Marks Foundation, argues that, although the mining companies pump out huge amounts in dividends to shareholders across the world, and although some Bafokeng are much better off now, the vast majority endure “unacceptable” poverty: 39 percent are unemployed, almost 95 percent use pit latrines and less than 13 percent have electricity. What is more, the report says, mining operations have so damaged the ecology that it is impossible to subsist on agriculture any longer. It might have added, as well, that education facilities here are said to be among the very worst in the province.

Many ordinary Bafokeng speak of their morafe as “a rich nation of poor people”. They think that, to the extent that there is “trickle down,” it accrues mainly to those connected with the royal family and other power brokers. There is also a fairly common belief, usually expressed sotto voce, that the royals themselves are being enriched by Bafokeng, Inc. This is in spite of the audit culture that has come to infuse Bafokeng, Inc., a culture that, even though it might not always be honoured, places an almost obsessive stress on transparency; and also in spite of the fact that the king and his mother appear to be paid relatively modest salaries, do not live extravagantly, and are scarcely implicated in Bafokeng business except as fiduciary officers.

Yet the quiet skepticism among Bafokeng about the wealth of their ethno-nation – its true extent is hard to gauge – is not confined simply to the spectre of royal riches. It also extends to the Geist of the morafe and raises the possibility of a species of executive privilege quite foreign to the Tswana ideal of bogosi yo bontle (good government). Company executives, by contrast, are governed less by accountability than by accountancy, less by the socio-moral needs of a nation than by the amoral imperatives of profit. Thus, indigenous rulers in South Africa who have tried to merge the roles of traditional chief and business leader have run into difficulties. And why Leruo, who appears keenly conscious of his mongrel office, has to ply the grey area between antithetical modes of leadership, antithetical forms of legitimacy and antithetical
imaginings of power.

More pragmatically, however, for him and for the financial managers of Bafokeng, Inc., the answer to “a rich nation of poor people” – and to populist skepticism in general – lies in Vision 2020. This is an ambitious plan to develop the morafe into a “selfsufficient”, more fully employed, globally oriented nation by the end of the coming decade. At once communally oriented and founded on a neo-liberal faith in finance capital, Vision 2020 fuses the two aspects of Leruo that he presents to the world: part leopard-skinned “traditional” authority, part Armanisuited businessman: entirely a figure of Afromodernity. Whether or not it addresses the concerns of his people at large, Leruo’s vision does have its patriotic Bafokeng supporters. Damaria Senne is one. She writes a blog from Johannesburg, where she is now a journalist. Responding to an announcement that the morafe was soon to have IT services installed, she enthused: “I’m very excited about the Royal Bafokeng Nation’s plan to roll out network infrastructure and to provide free phone calls and cheap Internet access for the community I call home.” This proved that its leaders had learned the importance of “holding onto the essence of who we are, learning from our tradition and culture, and using whatever resources are available to us to improve the lives of our people.”

Implicit in the question of who benefits from the wealth of the ethno-nation is the prior one of who belongs to it. In the past, entry and exit was fairly fluid and quite frequent. In common with the incorporation of identity elsewhere, however, the borders of Bafokeng appear to be a matter of rising concern. For one thing, the king himself has become anxious to “protect and enforce the ethnically-defined boundaries of the community for the purposes of controlling wealth” and he speaks of the need to control “continued alien influx”.

But the question has also arisen with gathering force around the accommodation of non-Bafokeng, those who have entered the kingdom to work in the mineral economy. Most of these people, who are seen unambiguously as outsiders, have become rentpaying tenants to local families; others are non-paying squatters, of whom many Bafokeng disapprove. Despite the fact that it still remains possible to join the ethno-nation by formal means, the influx of strangers seems to be deepening lines of distinction around ‘Bafokengness’, and all the signs are that they will deepen yet further as the corporate history of Bafokeng, Inc. unfolds.

bafokeng2What is missing in all this? On the surface at least – Damaria Senne notwithstanding – it would seem to be the cultural element of Bafokeng identity. With all the talk of Vision 2020, of finance capital and the stellar rise of Royal Bafokeng, Inc., of lawfare and long-term investment, discursive attention has been directed primarily at the business end of things. Of late, however, there has been much more, and much more self-conscious, culture-speak. And practice.

Most notable in this respect was the enthronement of King Leruo in August 2003, a ritual moment that celebrated not merely the inauguration of a new reign, but Bafokeng public ritual itself – in particular, the public ritualisation of Bafokeng, Inc. The event did not try to recapitulate an ossified notion of custom. It was composed, instead, of a fusion of elements that evoked an Afro-modernist culture under construction. Staged by VWV Group, a Johannesburg public relations firm, its dramaturgical content was partly invented, partly assembled from a historically mediated “tradition” – powerfully vernacular. It had all the trappings of the unveiling of a new product line, including elaborate, distinctly non-indigenous flowers and foodstuffs in the VIP section, about which were strewn mining magazines.
The monarch had on a dark business suit, on top of which the vernacular side of things became visible. A leopard skin covered his upper body throughout. What is more, he came into the stadium, his first public appearance in the ceremony, riding a donkey cart, expressly to perform his standing as the servant of his people.

When he addressed the gathering, King Leruo asked his subjects “not to abandon the ways of our forefathers” or to emulate those who “have, historically, denigrated our ways”. This echoes other instances in which he has underscored the necessity of seeking solutions to the problems of the future in African values, of relying on the technologies of traditional governance and of reaffirming Bafokeng heritage as the morafe moves forward into the global age of Afromodernity. King Leruo’s mother, the charismatic and forceful Mme Semane Molotlegi, seems to have foreseen some of this.

In 1999, she initiated a project under the banner Maikgantsho (We take pride). Its objectives, she told the mining magazine Enterprise, were: to foster the commitment of Bafokeng “to [their] culture and history”; to “advance community development”; to “create employment and small business opportunities”; and to “promote tourism and reap its benefits” – in other words, to put in place all the elements of Ethnicity, Inc.

Pragmatically speaking, Maikgantsho consisted of two initiatives linked by a craft-village ramble. The more important of them was to be a living history village, including, among others, examples of vernacular household architecture and a patlelo – an arena at the royal court, at which would be performed songs, dances and praise poetry. The other initiative was to be a services centre modelled on a highway oasis, at which would be sold African cuisine and other culturabilia. The ramble between the two was to be a paved walkway, 1km in extent, along which were to be dotted a number of “villages,” each specialising in a local craft “using age-old methods and materials”.

Bafokeng, Inc., then, is reaching toward a sense of collective cultural being in order to fulfil itself, to suture the gap between the communal and the corporate, and to find ways of giving itself “thicker,” more tangible, more emotionally compelling content. In part, it manifests itself in an anxious recognition that: the incorporation of an identity founded entirely on finance capital is not enough; it raises deep existential questions; and that the line between difference and indifference is gossamer thin. This is why the invocation of history and culture saturates the discursive surfaces of public life here, why it seems necessary, as the charter of the new Royal Bafokeng Institute puts it, “to consolidate national identity”.’

The point is not that the Bafokeng monarchy and its money managers seek simply to bring “ancient” ways back to life, thus to give an outer costume of African custom to a thriving business. Nor is it just to sustain the profitable tension between ethnocapital and ordinary enterprise. The matter is much more complicated, much more affect-laden. And its temporality is very much of the present.

“Tradition is not static,” says Mme Molotlegi. “Every one has to adapt.” To the global age, that is. The Age of Afromodernity, the Age of Ethnicity, Inc.

 

First published in Chimurenga Vol. 16: The Chimurenga Chronic (October ’11).

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