EADS Accused of Bribing South Africa to Purchase Weapons

EADS Accused of Bribing South Africa
to Purchase Weapons

Stockholm Dagens Nyheter (Internet Version-WWW) in Swedish 21 May 02 [Report by Christer Pettersson: "Bribes Used in Fight Against SAAB"]

Johannesburg - One of SAAB's competitors in South Africa, EADS, is suspected of providing perks to members of the South African Parliament's Defense Procurement Committee in connection with that country's purchase of weapons worth over fifty billion kronor.

The South African Sunday Times reported last weekend that Michael Woerfel, former CEO for South Africa of the multinational European defense manufacturer EADS (European Aeronautic Defense and Space Company), had arranged lavish free excursions to see elephants, lions, and other wild animals for South African politicians with families in connection with the arms deal that SAAD eventually won, obtaining an order for 28 JAS 39 Gripen planes.

Woerfel has since been suspended for selling Mercedes cars at a big discount to more than 30 South African parliamentarians and decisionmakers, including the chief of the country's military forces.

According to the Sunday Times, the safari expenses were entered in EADS' accounts under the heading "AT 2000," which is the name of the German plane competing with the JAS 39 Gripen. This information will be particularly important when South Africa's State Prosecutor attempts to prove that Woerfel and EADS bribed South African politicians. In the case of the discounted Mercedes, there was no direct connection to the arms deal.

So far, bribery affairs have claimed two victims: the former leader of the ANC's parliamentary group, Tony Yengeni, was forced to resign after he bought discounted Mercedes cars for himself and his wife from Woerfel. The former head of counter-trade arrangements of the South African Department of Industry, Vanan Pillay, was also forced to resign, while others, such as Chief of Forces Siphiwe Nyanda, have so far escaped.

SAAB and its partner BAE Systems have so far avoided charges of bribery. SAAB and BAE Systems spokesman in South Africa, Linden Birns, had said earlier that SAAB only offered trips to aviation fairs, lunches, and other things that were considered "common practice."

According to information received by DN [Dagens Nyheter] SAAB officials were subjected to pressure to give away passenger cars, or provide heavy discounts, but they claim they resisted these kinds of temptation.

The Swedish Government and politicians have been nervously monitoring trade developments, well aware that if it could be proved that SAAB had acted unethically in any way, this might lead to the entire Swedish defense industry being put at risk. The sector can survive only if it is able to export.

Description of Source: Stockholm Dagens Nyheter (Internet Version-WWW) in Swedish -- national, centrist daily