Africa economy
In South Africa, the limits of the “Black Economic Empowerment” policy [1/3]
Audio 02:17
If the policies of “Black Economic Empowerment” have notably enabled the emergence of those who are nicknamed the “Black Diamonds”, wealthy black citizens, they remain a minority.
(Illustration image) © Shutterstock/Contributor
By: Claire Bargelès Follow
3 mins
South Africa has sadly been at the head of the most unequal countries in the world for years, according to the regular rankings of the World Bank (with a Gini coefficient, which measures these inequalities, well above that of other countries).
In this first part of our series devoted to these inequalities, we dive into the world of business.
Management positions are still occupied at nearly 65% by white people, and less than 30% of company capital is held by black, mixed-race or Indian populations.
However, in 1994, during the democratic transition, positive discrimination policies were put in place to right the wrongs of the past.
But they have shown their limits.
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From our correspondent in Johannesburg
,
Yvonne Maitin is at the head of her own private investment fund, after a career of nearly 20 years in the world of finance.
She also sits on several corporate boards.
And throughout her journey, she realized many inequalities: “
You can see that Africans, and African women, are really very disadvantaged.
It goes from access to financing, access to markets, and in general these are difficulties in growing your business
.
»
However, the country has positive discrimination laws, called “BEE”, for “Black Economic Empowerment”, or the economic development of blacks.
If a company fulfills obligations in different areas, it will have easier access to tenders.
But these laws were quickly circumvented.
“
Some black women are used as a front, to be able to access funding, but then they have almost no role.
I got a lot of offers myself, and I realized I was dealing with this, so I turned them down
.
»
Philippe Bakahoukoutela is the current director of the Black Management Forum (BMF), an institution which encouraged the implementation of these “BEE” policies in 1994. And he recognizes their limits.
“
First of all, it should be stressed that these reforms were very important.
This allowed all the same to introduce a middle class.
But unfortunately, these advances have not really yielded the expected results.
It is really important that at the level of the government, at the level of the business class, of the companies of the place, that everyone ensures the effective application
.
»
The “Black Diamonds”, a minority
If these policies have notably allowed the emergence of those who are nicknamed the "Black Diamonds", wealthy black citizens, they remain a minority, according to Imraan Valodia, director of the Center for Research on Inequalities (SCIS) of the University of the Witwatersrand:
The benefits have only gone to a small group, so I think we need economic policies that will extend the benefits of growth disproportionately to those who don't have big salaries.
And alternative forms of shareholding could be developed, for example with more employee shareholding in companies.
Better policies are needed to redistribute capital
.
A new law is expected to be signed by the President soon to allow the government to strengthen these policies in targeted sectors.
This story is supported by a grant from the International Women's Media Foundation.
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