Revised B-BBEE codes are foolishly too high

IRECENTLY participated in a discussion on the new broad-based back economic empowerment (B-BBEE) codes that recently came into effect and what I heard concerned me.

The revised targets, per the new codes, are extremely high and may well be unattainable for many businesses that need good B-BBEE ratings to (financially) survive.

The promoters of these codes will probably say: “It’s our intention to shake things up.” But I question the wisdom of this approach when our economy is grossly underperforming.

We’ve just been told that our gross domestic product in the third quarter was measured at 1.4 percent – that’s “light years” from what is needed to provide jobs for the millions of unemployed, and soon-to-be unemployed (school-leavers).

We’re 20 years into our democracy – how much longer must businesses be coerced into artificially structuring their operations to get the demographics right?

I recently heard of two German companies that wanted to extend operations into South Africa, but they decided to invest elsewhere when our B-BBEE codes/laws were explained to them.

How much of this is happening without us knowing about it?

Businessmen don’t like being told how to run their businesses – now, that really isn’t economic freedom.

While I can understand the need for B-BBEE, I don’t believe that it should simply be a numbers game. It should be focused 100 percent on educating, training and upskilling those from the previously disadvantaged groups, and when they’re properly trained/up-skilled, they’ll get the jobs – provided the economy is growing sufficiently well.

The economy needs to be free of unnecessary red tape and must be business/ investor-friendly to encourage the inflow of capital to create employment.

More important, we need to encourage local business to invest the R630 billion that it’s sitting on. They’re not investing locally because they’re negative/uncertain about the future direction of the country’s economy (think nationalisation, increased taxes, B-BBEE, militant labour unions, investorunfriendly laws/regulations) – government needs to engage business.

However, what is certain is that if we fail to grow the economy at a significant rate, we will exacerbate the socioeconomic problems that we already have and find that we will no longer have sufficient funds for the social grants (about 15.8 million recipients) needed to placate the unemployed masses. Heaven forbid this ever happens. ROBIN MUN-GAVIN

Durban