BEE: Another Failed Experiment

While governed by apartheid system, the Republic of South Africa maintained a high degree of discrimination against the majority black people that resulted in economic inequality of a very extreme nature. Upon the collapse of apartheid and the ascent to democracy in 1994, the government was under pressure to secure quick gains for the black population that had borne the brunt of discrimination and exploitation. Choosing the easier path, the government came up with the Black Economic Empowerment programme in the mistaken belief that it would hasten the growth of the economy and ensure the development of a black entrepreneurial middle class.

That it has not succeeded is not a surprise to many who have observed African economies in general and societies that have had a legacy that leaves them with serious inequalities on account of systematic and sustained discrimination. It is often tempting to consider that discrimination in the other direction is the means for resolving those difficulties. After 14 years, South Africa has nothing to show for the BEE save for a small class of privileged and corrupt politicians who manipulated these rules to ensure that they acquired choice partnerships in successful firms.

Discussion in the Republic of South Africa has started now on how the BEE has performed and there's no denying that it has merely driven corruption by introducing unwelcome political considerations into business ventures. None other than Moeletsi Mbeki, the president's brother said this here during a conference on world economy held in that country. One cannot agree with him more on this point because racially motivated redistribution has been tried before in most of Africa and with disastrous results. All I wonder is why no one checked this fact that early because a formative decade has been wasted on unsound ideas. This is an experiment that the African National Congress ought not to have contemplated in the first instance and the president is not to be excused at all because together with his comrades, they succumbed to economic populism and forgot to lead. This time, the poverty is self inflicted and Apartheid retains the evil classification but it is not to blame here. Government does not know all.