The Black Economic Empowerment (BEE) policy in South Africa has been criticized for enriching a small group of politically connected individuals, rather than empowering the black majority. According to Professor William Gumede of Wits University, 46 individuals secured 60% of all BEE mining deals, becoming billionaires overnight. This has led to widespread criticism that the policy was never designed to benefit the majority of black South Africans.
The BEE policy has been in place for 32 years, and its impact on the South African economy has been significant. The policy has resulted in an estimated R5 trillion in cumulative damage, with annual growth cut by 1.5% to 3% and around 192 000 jobs lost yearly. The African National Congress (ANC) has responded to criticism by accusing critics of opposing justice itself, but many argue that the policy has failed to deliver on its promises.
The BEE policy has created a class of tenderpreneurs who profit from political connections, while the majority of black South Africans remain locked out. The loudest advocates of Broad-Based BEE (BBBEE) are not black entrepreneurs, but ANC NEC leaders who own land and control the economy's commanding heights. They have systematically abused BBBEE for personal enrichment, using the policy to accumulate wealth and power.
The ANC's approach to economic empowerment has been criticized for being at odds with the vision of the party's founders. The ANC was founded in 1912 by individuals such as Pixley ka Isaka Seme, who was a scholar, lawyer, entrepreneur, and Pan-Africanist visionary. Seme and his colleagues did not ask for an equivalent of BEE or social grants, but rather for equal rights and the freedom to build their own enterprises.
The founders of the ANC had a very different approach to economic empowerment, one that emphasized self-reliance and entrepreneurship. John Langalibalele Dube, the first President of the ANC, built the Ohlange Institute to cultivate self-reliance and self-determination, teaching industrial skills alongside academic ones. This approach was designed to empower black South Africans to build their own enterprises and create their own wealth.
In contrast, the current ANC approach has been criticized for promoting dependency and entitlement, rather than self-reliance and entrepreneurship. The party's emphasis on BEE and social grants has created a culture of dependency, where black South Africans are seen as recipients of welfare rather than as active economic participants. This approach has been criticized for undermining the very principles of economic empowerment that the ANC's founders had in mind.
The author of the article, Phapano Phasha, argues that the BEE policy must be rejected, not because black empowerment is wrong, but because this version has failed. He argues that black South Africans do not need BEE, but rather a policy that promotes self-reliance, entrepreneurship, and economic empowerment. The article concludes that rejecting BBBEE is not the end of the argument, but rather the beginning of a new conversation about how to promote economic empowerment in South Africa.
Key points
- BEE has created a class of tenderpreneurs who profit from political connections while the majority remains locked out.
