Thami Mazwai is a Resident Executive at Wits Business School in Johannesburg, South Africa. A former journalist and political activist, he is an expert in black economic empowerment. In this interview, he assesses the way policies to improve the situation of the black community in the economy has worked since the end of apartheid.
INTERVIEW TRANSCRIPT:
Question:
The black economic empowerment programme was one of the big ambitions of the post apartheid years. It seems the goals have not quite been reached. can you tell us what the results have been so far ?
Answer:
If you look at what has happened in the rest of the world, when there’s been change. South Africa decided to go there, negociate that settlement route. whilst in other parts of the worldt here was a complete change in government, in which case the old order was displaced, and the new order took over. So in such situations the new order then immediately implements its programmes.
Sometimes they work and sometimes they don’t work. More often times they don’t work. This has been the experience, whether in South America, sub-saharan Africa, and even in transition economies, the former communist countries. You go through those hurdles. South Africa decided to go through the negociated pattern, the whole question of transformation. Then they had to be a special programme for it to integrate blacks into the economy. that’s why you had black economic empowerment
But like all new programmes, it had not been tried anywhere else, we had our fits and stunts. So we are now into the second phase of the programme, where the codes of good practice have been reviewed, have been reduced from 7 to 5. And the lessons we learned from the first phase are not perhaps going to result in a much more visible or in a way in which the outcomes are going to be much more to expectations that has been in the past.
Question:
What are the options, what has been missing and what is this second phase ?
Answer:
What we wanted was obviously to integrate blacks in the economy. Now..to integrate people in the economy in which you change the patterns of ownership, the patterns of management, is not an easy process. You set targets. and the people who must meet the targets are doing so on a voluntary basis. There was no specific legislation that said, if you don’t..there were no penalties, so to speak. And because there were no penalties it then became optional. And organisations do not really want to change to anything new, when the one they have is waiting for them. Therefore the uptake has not been what it should have been now with effect that there are now compulsory targets that have been set. The transformation is going to be much more faster than it has been.
Question:
Has this had an impact on the white owned firms on the other hand..has it affected them in any way ?
Answer:
“I’m not sure by impact what do we mean. But what I do know is that the white firms are now realising that tranformation, black economic empowerment has got a benefit for them. In that they get into new markets and they get new consumers. and they get to get to understand the south african environment in a much more better way than they used to in the past.And that affects both the white, both the local companies and the multinationals.So there is now greater enthusiasm on black economic empowerment that is more entreprise supplier… to the question of suppliers, than there has been in the past. In the past the idea was jut to put blacks, give them shares. And some of the shares were dummy shares, some of them were special vehicles and so on… And there was a lot of dishonesty in the process. Now that there are clear tangibles in terms of transformation that we made like entreprise and skills development, where clear targets have been set, i think its going to be much better.
Question:
Who would you say has gained most and lost most from the post apartheid years ?
Answer:
Well it’s white business! They have benefited most you know. Because all of a sudden , whilst they used to operate with guilt in the past, that guilt has been removed. but they have not yet made any tangible contribution towards transformation.Of course you cannot talk of the corporate world itself is homogeneous. There are companies that have gone the extra mile, and the others that have just not done anything. And then when you weigh, when you aggregate the effort, you find that it has not lived up to expectations.
Question:
Whose responsibility is this? would you say there is still an economic apartheid ? Or is it too far-fetched ?
Answer:
“Well the economic apartheid is still there whether you like it or not. You just have to look at the employment equity report. which is published by the ministry of labour. you can look it upon the website. It will show you the levels of black participation in companies where you find that for women, black women for instance it’s less than 5 percent. Obviously that’s just not acceptable.
Question:
So what are the solutions ?
Answer:
“Well it’s a much more rigorous enforcement now. Where the government brings in penalties for companies that are not complying. There’s no other alternative. Because even when you had the old question in terms of government tenders, those companies that depended on government tenders would be the ones that would try and comply. But still they would then also try and shortchange the system by having front companies and so on. So there’s been a whole plethora of problems that have bedeviled the process.
Question:
What would you say has been Nelson Mandela’s main legacy in terms of the economy ? Is there an economic legacy ?
Answer:
“I think that when you look at the economy, you obviously have got to look at the environment, the post democracy environment. And I believe that one wouldn’t expect Nelson Mandela to be involved in every sector of socio economic development. Whether it’s health, whether its education and so on.
He would perhaps be the visionary who says for us to have a good economy, let us have South Africa getting more united, let us have a situation where there is greater harmony amongst the people. And that’s the role that he has played. But the individual players would be the business people, the black business people, would be the multinationals and so on. And it would be a question of how well do they respond to his vision.
And like I’ve said, some have done very well. They’ve built schools, they’ve invested in projects that are in the rural areas and so on. So that has happened, we can’t say nothing has happened. But the point is that when you aggregate what has happened and what has not happened you find we’ve not yet met expectations of the people on the ground
Question :
Are you confident that these things will happen ? Especially in the aftermath of Nelson Mandela’s departure?
Answer:
“Let me first deal with aftermath of his departure. Charles de Gaulle left and France continued. Winston Churchill left, and the UK just continued. John F.Kennedy left, and the United States got stronger, and so on. So i dont believe that South Africa is dependent on one individual. South Africa is a country with various people, with leaders, with numerous political parties, churches, community organisations..The whole social fabric is what south africa is. And I dont believe that that social fabric just hangs on one person. South Africa is going to continue, with or without Mandela. And I believe that perhaps the fact that this comfort zone that is Mandela, is no longer there. Then people will understand that they’ve got to live up to their responsibilities. And there might even be much more speeding up of the transformation.”