Black Economic Empowerment and South Africa

By Emkes, Will | Contemporary Review, June 2012 | Go to article overview

Black Economic Empowerment and South Africa


Emkes, Will, Contemporary Review


SOUTH Africa has always been plagued by inequality. From settler-colonialism, through enforced industrialisation, to apartheid capitalism and the eventual attainment of democracy, the nation's history has always been marked by conflict and inequality. Today, economic inequality is the dividing force within the country. The differences between the 'haves' and 'have nots' are now entrenched within society, and consequently, have begun to threaten the foundations upon which the African National Congress (ANC) hoped to build a free, fair and multiracial democracy. Disillusionment has steadily crept into the popular mind, brought about by stubbornly high rates of unemployment, a poor standard of education and dire health services. The ANC now faces considerable challenges in governing a united South Africa.

An unmistakable cause of resentment amongst the population is to be found in the stench of graft, patronage and greed surrounding ANC officials. The perils of such a dominant party system have made themselves vividly apparent, especially under the presidency of Jacob Zuma. Zwelinzime Vavi, General Secretary of the Congress of South African Trade Unions (COSATU), has described Zuma's administration as 'heading rapidly in the direction of a full blown predator state', run by 'corrupt and demagogic political hyenas'. Under Zuma's watch the ANC has run roughshod over any distinction between executive power and the state, business and politics. In doing so it has bred corruption at the very heart of government, with a seeming contempt for democratic principles.

The domain in which this distinction is most blurred is the laudable pursuit of Black (1) Economic Empowerment (BEE), the consequences of which now threaten South Africa's relatively young democracy. The policy, which the ANC has vigorously pursued since taking office, has been a failure. It has failed to redistribute assets to the majority black community and resulted in the enrichment of a few BEE dealmakers. The nature of BEE deals under Zuma's presidency emblazons that which one should be worried about, that which should be objected to. Lip service is always paid to the old ideals of the liberation struggle, yet the party is increasingly rudderless, it has lost its way. In doing so South Africa is now heading towards a dangerous fate, a fate which should be averted at all costs.

A New Inequality

When the ANC was elected to office in 1994 it identified BEE as the key instrument with which to penetrate the inequality and exclusion the apartheid era had built around the South African economy. The result has been widespread confusion over how to implement such policy and the extent to which it can act as an effective agent of social change within the country. To date, South Africa has seen a relative privilege conceded to a minority of blacks, whilst preserving the pre-existing structures of social inequality, breeding a new capitalist class largely to the detriment of the black masses. Moeletsi Mbeki, the brother of the former president, has said that BEE has proved a 'parasitic drag' on economic growth, having struck a 'fatal blow against the emergence of black entrepreneurship by creating a small class of unproductive but wealthy crony capitalists'. Numerous studies have shown that inequalities amongst the black population have increased, with the affluent becoming more affluent and the poor becoming poorer. In doing so, South Africa now fosters a new inequality: the disparity between rich and poor has widened to an almost unbridgeable chasm in the last two decades.

Under nearly half a century of apartheid, the majority of South Africans were left out or confined to the margins of the country's mainstream economy due to race, today they remain so, with capital acting as the principle force of inequality. BEE has resulted in the enrichment of a small enclave of black shareholders. Names such as, Patrice Motsepe, Saki Macozoma, Cyril Ramaphosa and Tokyo Sexwale have appeared repeatedly in different deals. …

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