South Africa: Iraq oil report is Zuma's first real test

The Donen commission was set up by former president Thabo Mbeki to probe the involvement of South African companies and individuals in violating UN sanctions on Iraq. 

Despite promising to make the commission's report public, Mbeki kept it under wraps after it was handed to him in late 2006. Deputy President Kgalema Motlanthe did not release the findings during his stint as president.

A weekend newspaper reported the Donen Commission found that Motlanthe -- ANC secretary general at the time -- was privy to material information relating to businessman Sandile Majali's shady oil deals with former Iraqi president Saddam Hussein.

Majali, known to be an African National Congress funder and also implicated in the Oilgate scandal in 2004, is said to have entered into deals with Iraq through his company Imvume, in the process contravening UN sanctions.

According to the report in the Sunday Times, the commission also cast doubt on a submission by businessman Tokyo Sexwale, now human settlements minister, that he did not know that a company of which he was co-director had paid money to the Iraqi government, in violation of the oil-for-food program.

It is estimated that late Iraqi dictator Saddam Hussein's regime made $1.8-billion in surcharges and kickbacks on such deals.

An investigation by the UN's independent inquiry committee in 2005 found that because Iraqi officials were allowed to choose oil customers, they levied the surcharges on companies who applied for allocations.

These companies included Montega Trading, on whose behalf Majali's Imvume allegedly offered to pay surcharges, and Mocoh, in which Sexwale was a co-director.

The report claims that, on an unspecified date, Majali promised to pay Rand 464,000 from the proceeds of the resale of the 1.8 million barrels of oil he had bought on behalf of Montega Trading. The oil was to be supplied to South Africa's state-owned Strategic Fuel Fund. Sexwale told the commission in a statement that he did not know Mocoh was told to pay surcharges on oil deals with Iraq.

The opposition Democratic Alliance said it believed Zuma would need to make the full report available to the public.

Zuma, whose African National Congress Party (ANC) swept into power in April elections on the back of strong support from unions and the poor, has promised to stamp out corruption. How he deals with the Iraqi allegations and those implicated will be watched closely at home and abroad.