Critical shareholders fail to uphold BEE
South African anomaly as other developing economies, such as Asia and Latin America, have had their own varieties of BEE. Some are the structuralist theories which were in opposition to the orthodoxy, the then Washington Consensus which included the structural adjustment programmes imposed by the International Monetary Fund.
As I tried to explain this point, the interviewer peremptorily retorted that there are many examples of success, for instance white-owned entities like Pick n Pay buying from black suppliers. Let us do a bit of reflection.
In his book on Afrikaner empowerment, Rashid Begg says the most telling success of Afrikaner empowerment “is the elimination of the phenomenon of poor whites as a national issue”.
The Jewish people turned Israel into a regional powerhouse through sheer commitment by every Jew to the ideal. What about the Germans after World War II? We have had BEE for 25 years, but poverty, inequality and unemployment continue to ravage the black community, and are increasing.
Granted, we are not comparing apples with apples in terms of time and politico-economic dynamics, but the message is there. The determination and commitment on the side of the above beneficiary communities and governments, plus their media, was unshakeable.
In our case, our government wants to be all things to everybody. We then also ululate at isolated sparks of empowerment or, as Uncle Tom did, simply blame the victim. We seem unaware of black initiatives that daily go up the wall as the environment is biased against black entrepreneurship.
Our interviewer and Uncle Tom have even reduced entrepreneurship and its complex relationships and undercurrents into a simple arithmetic of buying from black suppliers and/or taking advantage of opportunities and presto, it is done.
They seem oblivious of the dynamics of the market or environment. To give an example, black entrepreneurs have to swim against well-established businesses with all the resources under the sun, networks and linkages that make it that more difficult for new entrants to survive against these, including overseas players.
The embedded superstructure is what I am talking about, and government departments that happily tick boxes oblivious to the sensitivities in the marketplace. For instance, the Department of Energy is rolling out solar water heaters and rightfully stresses the participation of black manufacturers.
A few of these black manufacturers have emerged, but the odds are stacked against them. One informed me that she has 1 500 in her warehouse and must deliver the first 400 in terms of her contract with the department. But, and here is the rub, the department wants a performance bond or guarantee of R6.5 million.
Fair enough, this ensures that she meets the criteria and conforms to quality. But what was not taken into account is that this lady, and many other black manufacturers, cannot provide the performance bond or guarantee.
Worse still, the government-owned development finance institutions like the National Empowerment Fund and Small Enterprise Finance Agency are barred by the Public Finance Management Amendment Act from providing such guarantees.
Our media does not take the Treasury to task for regulations that stunt BEE, regardless of the fact that not a single black person in the media does not have a relative out of employment.
Fighting for survival
The already existing white-owned manufacturers, some with dubious BEE compliance, have orders of 2 000 or so a month, while our black woman has an order for 400, which she cannot even meet at the end of the day.
In my last column I spoke about black people in the liquefied petroleum gas sector fighting for survival as the major player tries to choke them out. Nobody is saying anything about it as, after all, the victims are black. Black people in the media, who should be leading the crusade as we did in the political struggle against apartheid are spouting neoliberal chants.
My interviewer has hardly had these players on the other end of the line to
The embedded superstructure is what I’m talking about, and government departments… oblivious to the sensitivities in the marketplace.
explain why they are smoking out black entrants. With compatriots like some in our government and media, transformation does not have to go far to fail.