Doing deals with white devils — avoiding a Faustian pact with fossil-fuelled fascists

Ever since the surreal made-for-reality-TV White House meeting between presidents Cyril Ramaphosa and Donald Trump, I have been pondering the question of how much the moral integrity of a nation is worth? Is it worth so little that we are willing to compromise our ideals and act fawningly towards fascist leaders to chase bad trade deals with genocidal states?

Those questions have renewed importance now that South Africa seems on the cusp of securing an agreement with Trump’s White House. According to government sources, Alistair Ruiters, Ramaphosa’s special investment adviser, is apparently close to a trade deal that might lower America’s tariffs on South Africa. 

For industries that have been hard hit by the Trump administration’s erratic tariff regime, one can understand how any reprieve would be welcome news. Here in the Eastern Cape especially, major industries including agriculture, automotives and manufacturing are struggling with the impacts of the tariffs. In the context of deep unemployment, economic stagnation and government failures, the blow of the US tariffs has been brutal.  

Against this backdrop, it might be tempting to welcome any deal with the US that lowers tariffs as good news. However, we must be incredibly careful about how much we are willing to sacrifice to achieve that goal. To see the dangers of doing so, we can examine the linchpin of the previous proposal that was sent to the White House.

Meth(ane) addiction

Trade, Industry and Competition Minister Parks Tau disclosed that in July South Africa had sent a trade proposal to the US. The biggest element of it, by orders of magnitude, was a programme to get South Africa hooked on American methane – or polluting methane gas in the form of imported liquefied natural gas (LNG). Tau’s proposal promised that South Africa would import a massive R200-billion-plus worth of LNG from the US over the next decade.

Far from being a great energy deal that would help South Africa, the costs of LNG threaten to weaken South Africa’s competitiveness and saddle us with even higher electricity costs. The reason is that LNG power generation is an inferior, less-economic form of energy than readily available alternatives that South Africa could build, including wind, solar and storage. Other countries have already learnt that lesson for us. 

In the words of Sam Reynolds, LNG/gas research lead, Asia, at the Institute for Energy Economics and Financial Analysis (IEEFA): “Based on dollars and cents, LNG is uncompetitive with renewable energy technologies. It’s unreliable compared to domestically sourced low-cost renewables, and it is not displacing coal in many emerging markets. So, despite what the industry says, relying on LNG is a pathway to energy insecurity, not energy security.”

As IEEFA’s research shows, LNG’s high costs, volatility and insecurity are pushing some of the world’s largest LNG markets, including Europe, Japan and South Korea, to rapidly reduce their reliance on LNG. As a result, LNG suppliers are desperately looking for new markets and trying to lock emerging economies, like South Africa, into methane addiction. It’s an addiction that could prove immensely costly, with LNG up to five times more expensive than renewable energy in emerging markets. 

The environmental costs of LNG are also immense. Oil and gas industry propaganda has been effective in perpetuating the myth that methane gas is a clean source of energy. They even convinced the world to call it “natural” gas, even though the only time natural gas is natural is when it’s left underground. However, when it’s extracted, processed, transported and burnt, its ecological impacts are devastating. 

Far from being a clean, natural source of energy, methane is a super-potent climate pollutant. LNG is even worse than standard “natural” gas, since it requires vast amounts of energy and processing to transport, which often results in polluting leaks. As such, studies by Cornell University have shown that emissions released during LNG’s extraction, processing, transportation, storage and burning, can make it 33% worse for the climate than coal or normal natural gas – both of which were already orders of magnitude more polluting than renewable energy. 

In the words of Dr Robert Howarth, a biogeochemist and environmental scientist at Cornell University: “LNG has the largest climate impact of any fossil fuel on Earth. The greenhouse gas footprint of LNG is around a third worse than either coal or regular natural gas. It is the worst, so it’s not a transition or bridge fuel. It’s a climate disaster.”

The art of the fossil fuel deal    

When thinking about whether it’s worth South Africa getting hooked onto polluting methane through a R200-billion-plus LNG deal with America, it is helpful to take a step back to examine the broader geopolitics at play and remind ourselves who the Trump administration serves. 

Last year, in an open demonstration of America’s legalised oligarchic corruption, Trump promised the oil and gas industry that he would serve them if they backed his election campaign. As they have done many times before, the coal, oil and gas industry donated generously to the Republican Party to help them and Trump get elected. 

In typical quid pro quo, Trump’s Republican Party has gone to work trying to stifle renewable energy through the heavy hand of government, giving vast subsidies and tax breaks to fossil fuels, blocking renewable projects and dismantling environmental regulations. Likewise, on the international stage, one of its key geopolitical priorities is serving the interests of fossil fuel companies. 

If you examine Trump’s tariff deals or shakedowns, a key thread runs through them. They have tried to get countries to agree to buy American fossil fuels in exchange for lower tariffs. Not just emerging economies, but Europe, Japan, South Korea and more. 

Many commentators have struggled to make sense of why Trump would scupper his right-wing bromance with India’s Narendra Modi through such heavy tariffs on that country, supposedly in retaliation for them buying Russian oil and gas. It’s hardly because Trump has a principled stance against his much-beloved Vladimir Putin. Rather, his administration is arguably trying to stop India from buying Russian oil and gas, and instead get them hooked on American fossil fuels. 

Arguably what we are seeing play out is America, the petrostate, trying to extort countries into buying its oil and gas. It’s a last-ditch attempt by the US fossil fuel industry to dominate a shrinking market share that is being increasingly taken up by renewable energy, storage technologies and electric vehicles. 

Resisting outdated Western energy imperialism

Notably absent from critiquing our proposed deal with America has been South Africa’s most vocal fossil fuel dinosaur, Mineral and Petroleum Resources Minister Gwede Mantashe. He had been a loud critic of the West for trying to supposedly “encircle” South Africa by offering us finance for renewable energy, saying it threatens our energy sovereignty. Now, when America is openly trying to extort us and get us hooked on American gas, Mantashe’s vocal criticism of Western energy imperialism is missing.  

Mantashe’s silence is not surprising though. After all it was Mantashe himself who fought viciously against local communities in his attempts to sell off South Africa’s natural resources to rapacious Western multinational oil and gas corporations like Shell, Total and friends. 

Right now, though, South Africa is being bullied by the biggest Western superpower in town. We need to resist rather than embrace that bullying and the neocolonial energy deals that come with it. We need to resist it not just for moral reasons, but also for economically pragmatic reasons. 

The age of clean technology manufacturing

If we look to the real economic superpower of the moment, China, we see that the future lies in electrification through green industrialisation and renewable energy. China’s investments at home show a massive push into renewable energy, storage and electric vehicles, in large part because they are just simply superior technologies. China’s clean tech investment dwarfs anything the West is doing right now, and it is going global too.

As researchers at Johns Hopkins University have shown, China has pledged at least $227-billion across green manufacturing projects globally. That is more than four times what America spent on its Marshall Plan, which attempted to shape the world economy in its favour after World War 2. 

Following China’s lead, much of the world is making a massive pivot to superior, cleaner technologies – ones that are delivering lower energy costs and reinvigorating green industrialisation pathways, and which promise not just energy security, but clean energy superabundance. As the International Energy Agency argues, the world is entering “a new age of clean technology manufacturing”. 

An existential question facing South Africa is whether we will hitch ourselves to a dying US fossil-fuelled empire, built on white supremacy, ecocide and genocide. Or will we instead embrace technologies of the future and work to build a more just multipolar world order where America doesn’t get to bully us into accepting bad trade deals, all the while making us bend the knee and kiss the ring of genocidal leaders.  

Consider that despite South Africa bringing a case of genocide against Israel at the International Court of Justice, we are still exporting a vast amount of coal to Israel. The main company that is doing so is Glencore. It is worth noting that Ramaphosa was Glencore’s local empowerment partner at the time it acquired Optimum Coal Holdings in 2012. While Ramaphosa divested his interests in Glencore in 2014, that relationship raises tricky questions about why South Africa is still helping fuel apartheid Israel. 

Is it not long past time that we put our money where our mouth is and boycotted apartheid Israel, just as countries did to apartheid South Africa? Here we can look to the example of Colombia, which has stopped sending coal to Israel. Beyond that, Colombia is forging an economic path that challenges the domination of America’s rapacious fossil-fuelled empire. Instead, it is building a multipolar future on the foundations of environmental and social justice and powered by renewable energy.  

Empowering white supremacists 

Beyond challenging America for its massive role in enabling, funding and arming apartheid Israel’s genocide, we must ask how much South Africa wants to enable the Trump regime? Do we really want to be doing trade deals that strengthen white supremacist leaders who are deploying the military to their own streets, engaging in extrajudicial arrests, kidnapping and murders and driving America into fascist authoritarianism?

Some might argue that such moral posturing is a luxury South Africa simply cannot afford given the weakness of our economy. They might say that we need a trade deal with America to reduce tariffs, so that we can salvage some jobs, economic growth and industry. As I’ve tried to highlight though, the deals that we are considering with America could be incredibly costly and get South Africa hooked on America’s polluting and expensive LNG.  

While reduced tariffs would make an important difference for some in the short term, in the long term the proposed deals could lock us into higher, more volatile energy costs as well as political, economic and energy dependence on an increasingly erratic and authoritarian US regime. Is that really a good deal for us in the long run? 

Perhaps, instead, we could take the money we would give to America’s fossil fuel industry and redeploy it to strengthen and support our local industry and find new markets. We could use that money and other funds to put South Africa on a homegrown green industrialisation pathway, which would create more jobs, economic opportunity and economic sovereignty. 

Perhaps this is a moment for South Africa to step out from under the neocolonial shadow of America’s fossil-fuelled empire. Rather than accepting a bad deal from the White House, we must be bold and find our rightful place in a multipolar world order built on mutual respect and the technologies of the future, not polluting, expensive technologies of the past. DM

Dr Alex Lenferna is a research fellow at the Institute of Social and Economic Research at the University of Fort Hare. Views expressed are his own.