By Moyiga Nduru
JOHANNESBURG, Mar 4 2004 (IPS)

Ten years after the demise of apartheid, South African blacks are still waiting for a slice of the economic pie they were denied in the past.

The 1994 multi-party elections that saw Nelson Mandela become the country’s first black president brought political freedom to the country.

However, the poll didn’t give the new government any substantial power over the economy. Whites, who make up 13.6 percent of the population, still dominate trade and commerce in South Africa – an inescapable legacy of decades of discrimination against blacks.

Under apartheid, blacks were largely confined to tribal homelands known as Bantustans where they were not allowed to own property or vote. Those who moved to cities found themselves restricted to shantytowns, where there were few prospects of finding a decent job.

“What happened in 1994 was just political independence. The whites simply transferred power into black hands. And they kept the wealth within their community,” James Molefe, a security guard, told IPS this week. Molefe works in Cresta, a middle-class suburb of Johannesburg.

Such bitterness is widespread in the black community. About 5.3 million people – or 31.2 percent of South Africans – are unemployed, according to official statistics. Most of these people are black.

To help change the situation, President Thabo Mbeki has initiated a policy of “Black Economic Empowerment” (BEE) which is similar to the affirmative action programmes adopted in the United States.

Essentially, BEE involves a balancing act of trying to draw blacks into the formal economy without imposing regulations so intrusive that they might end up destroying business. Mbeki has pledged to spend about 2.4 billion dollars to encourage empowerment within the next five years.

So far, government has enacted two laws to promote BEE. The first, the Mining Charter, calls for 26 percent of mines to be owned by blacks within a decade. The second law, the Financial Services Charter, seeks to place a quarter of this sector in black hands by 2010.

Government is also trying to integrate BEE principles in trade agreements. “Any free trade agreement will have to accommodate black economic empowerment,” says Xavier Carim of the Department of Trade and Industry.

While no one disputes the need to broaden South Africa’s economic base, Mbeki’s efforts have not drawn universally favourable reviews.

“They are just trying to create millionaires and billionaires,” says Douglas Gibson of the main opposition party, the Democratic Alliance (DA). He was replying to a question posed by IPS to party leaders this week.

“What South Africa needs is to develop a passion for growth,” Gibson added. “Through growth we can create jobs and reduce poverty.”

Patricia De Lille, leader of the Independent Democrats (ID), said black empowerment was not a panacea for South Africa’s economic ills. “It is the same people – the rich and not the poor – who are benefiting.”

Musa Zondi of the Inkatha Freedom Party (IFP), the largest black party after the ruling African National Congress, declined to comment on the merits of BEE – this when he was questioned by IPS during a debate organised by the Foreign Correspondents’ Association in Johannesburg on Mar. 1.

But a day later Zondi joined IFP leader Mangosuthu Buthelezi and the head of the Solidarity union, Flip Buys, in Pretoria to sign a charter that seeks to address the fears of whites who feel threatened by BEE. Buthelezi said whites were being excluded from appointment and promotion opportunities simply because of their skin colour.

Some analysts insist, however, that there is cause for hope in this scenario of apparent doom and gloom.

“A great many positive changes took place during the past 10 years,” Shoni Makhari of the Johannesburg-based empowerment rating and research agency EmpowerDEX told IPS on Wednesday (Mar. 3).

Some of the most noticeable of these changes are at the Johannesburg Stock Exchange (JSE).

“The traditionally pale male boardrooms of JSE-listed companies are slowly beginning to embrace diversity,” says Vuyo Jack, Chief Executive Officer of EmpowerDEX. “The number of black directors increased last year in line with a trend dating back to 1992 when only 1.2 percent (from) the top 100 JSE listed companies were black.”

According to EmpowerDEX’s latest survey of directors, blacks now make up 14.7 percent of directors at JSE listed companies.

Various big firms have also put BEE policies in place. Anglo American, South Africa’s largest company, is spending about 1.7 billion dollars to encourage black empowerment. It hopes to fill 40 percent of its local management positions with blacks in five years. Currently, only 20 percent of the positions are held by blacks.

However, certain black groups have criticised the fact that black elites are amongst the primary beneficiaries of empowerment.

In a recent statement, Dan Habedi of the opposition Azanian Peoples Organisation (AZAPO), said, “Black Economic Empowerment was, from the start, not meant to bring about general transformation for ordinary people. It was an effort by Black Business to get, for themselves, some entrepreneurial advantages…They wanted economic policies that would benefit them.”

“Some people may argue that everybody, irrespective of social standing or class position is given a chance to become an owner, because in most cases, as it happened in the selling of Telkom shares, all members of society are invited to buy shares and become owners,” he adds. (Telkom is South Africa’s leading telecommunications provider.)

But, says Habedi, this type of ownership does not necessarily translate into control. And “As experience has shown, ownership without control denies such an owner the opportunity to determine the scope and direction of his economic ventures.”

Since 1997, Telkom has spent about 2.9 billion dollars to ensure participation of black, female and disabled South Africans in the economy, says a Telkom spokesperson. The company procures goods and services from suppliers run by people who suffered under apartheid legislation.

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