B Fine and Z Rustomjee, The Political Economy of South Africa: From Minerals-Energy Complex to Industrialisation, Witwatersrand University Press, Johannesburg, 1996, 278 pp.

This book by Fine and Rustomjee provides a good background to scholars and practitioners alike on the origins of South Africa’s minerals and energy complex, the MEC. The acronym, akin to the oft-repeated notion of the ‘military-industrial complex’ (MIC), illustrates the origins of South Africa’s mining wealth and the manufacturing sector that emerged from it in the early twentieth century.

Fine and Rustomjee methodologically take us through the varying roles played by mining firms, the state, English versus Afrikaner capital, and the connections between economic processes and economic agencies. They later examine lessons South Africa can learn from the Asian ‘miracles’, with emphasis on export-led growth and import substitution. In this regard, the South Korean model has some select similarities with South Africa’s history of state intervention in economic growth, e.g. the development of the steel industry which supported shipping and the automobile industry. Both countries had a colonial past. In South Korea’s case, the Japanese colonisers provided a great deal of the economic base, especially in steel production. In the South African case, it was English capital that dominated the mining sector in the early years, leading to antagonism among Afrikaners, who found it difficult to find a break into that sector until after their election victory in 1948. It was at the height of this period that Afrikaner capital consolidated its positions through the use of the state, with the founding of the Iron and Steel Corporation (Iscor), and later the electricity giant Eskom, the chemicals manufacturing company Foskor, and other state corporations. Eskom was well positioned against the background of coal production, the main source of fuel for its electricity supply. This gave South Africa a comparative advantage over other countries.

Intervening years saw further development of state corporations such as Sasol and Armscor. State protection included tariffs and competition policy. The authors have illustrated the disjuncture between English and Afrikaner capital, but it is this reviewer’s opinion that they downplay the collusion between the two ethnic groups in the exploitation of black labour and the establishment of the slave-like hostel compound system. They do highlight the role of capital in efforts towards establishing the black middle class after the 1976 uprisings, to act as a buffer against the resistance to white minority rule. Subsequently, the state played an active role in the promotion of Afrikaner interests and capital, gradually moving into the traditionally English-dominated mining sector. This development accelerated to such an extent that, by the early 1980s, there had been a process of interpenetration of English and Afrikaner capital. This occurred to such an extent that it was no longer easily distinguishable which was English or Afrikaner, such as Anglo-America, Gencor, Sanlam and Rembrandt. Conglomerates dominated (and still do) South African industry, but started to move the MEC into the manufacturing and financial sectors. As for mining, a shift has occurred to other mineral production, such as platinum, diamonds and copper, with less emphasis on gold given its current low price in the international market.

Fine and Rustomjee used archived material that is not easily accessible to the ordinary scholar or practitioner. Their use of well-illustrated graphs and charts makes for easier reading. The book has a complex, yet accessible style, and is well-referenced, with attention to detail. The book is an attempt to prescribe for South Africa what the so-called Asian miracles have achieved. Without taking too simplistic a view, the authors omit the fact that South Korea grew and developed on the basis of the massive loans provided by the American, Japanese and international lending agencies. More recently, this resulted in over-borrowing, and led indigenous companies and banks to collapse. The book is timely and provides insights into the development of the highly industrialised South Africa that we know today, from a minerals-energy complex to industrialisation.

Tsepe Motumi
Defence Secretariat

Ian Anthony (ed.), Russia and the Arms Trade, Oxford University Press, Oxford, 1998, 304 pp.

Having gone from being the second largest arms supplier during the height of the Cold War, Russia, as the main successor to the Soviet Union in the sale of weapons, dropped to record lows in the early 1990s. In this recent book, Anthony and a selection of experts on the Russian arms trade review the international trend in arms sales, examine the conventional arms trade of the Soviet Union, and then detail the factors which caused the slump, and subsequent upswing in Russian arms exports.

According to estimates by the Stockholm International Peace Research Institute (SIPRI), the Soviet Union accounted for 38 per cent of global trade in conventional armaments in 1987; by 1992, this had declined to a fourteen per cent share by Russia and fell to a low of three per cent in 1994 (for exports valued at approximately US $1,7 billion). By 1997, however, Russia had re-emerged as an important arms exporting country, with sales comparable to those of the United Kingdom and France. It is estimated that its 1996 sales were worth over US $3 billion. The factors behind this rise, which include the ability of Russia to stabilise and consolidate its arms transfer relations with India, and open or renew relationships with China, Iran and Malaysia, are studied in detail. They include external factors which impact on Russia’s arms export policy, the changes made by Russia in terms of licensing arms transfers and the decision-making process behind these, the role of the Ministry of Defence and the Russian defence industry in arms exports and the role of co-operation between Russia and its neighbours, including the successor states of the Soviet Union and countries in Eastern and Central Europe (the former Eastern bloc), in addition to those mentioned above.

This book makes a good assessment of the factors behind the Soviet era’s decision-making process (which, like the United States, the other main arms supplier during the Cold War, used arms transfers to support wider foreign and security policies) and identifies the current trend for arms sales — a case-by-case process of deciding on arms exports. However, it is recognised that, in being driven by a need to sell arms for economic purposes, Russia may not give enough attention to international commitments and perhaps its own military security. Russia’s arms export system is also still opaque, not allowing information on the revenue Russia receives from its arms exports and how that money is distributed among various departments, to be known. Nor is information on the size and pattern of these sales revealed. However, the level of public information that is available, is comparable to that of many European countries, including France and the United Kingdom.

Yet, this book also signals some important firsts, including assessments of Russia’s position and decision-making process by Russian government officials and academics, both of whom were earlier either prevented from writing about the issue or denied access to information on arms transfers. It publicises a large amount of specific information, for example, on the types of arms exported, the values of sales and the motivations for sales. It is therefore an invaluable source to anyone who works on conventional arms control issues or who has an interest in the issue.

Sarah Meek
Institute for Security Studies