The critical success factor for sustainable economic development and transformation in any country is unencumbered free enterprise and fair competition.
It is not hearsay that the development of the South African economy continues to be arrested by past political and economic barriers to entry. Barriers that gave and continue to give unfair economic advantage to those enterprises established during the apartheid era. These enterprises have continued to become stronger, more established and therefore more formidable to challenge and compete against and are quick to counteract any possible opportunity space that may be created for blacks.
Many sectors of this economy continue to be dominated by white capital and organized cartels, not because they are smarter but merely because of the historical deliberate nullification of competition from blacks.
White companies and businesses that have emerged from the apartheid era enjoyed political protection and support from the exclusive business environment created by the architects of the past. It is an open secret that the apartheid government played a significant role in shaping the socio economic architecture of this economy. The role of politics is was to create economic advantage for those classified as white. In order to deactivate and transfer the unfair advantages of the past to blacks in general free enterprise cannot continue to exist until such time as the playing fields have been leveled through politics.
The march for economic freedom by the ANC Youth League should be seen in this context and, in my books, it is not a threat to the status quo but a platform from which we must see black entrepreneurs begin to gain emotional momentum to take control of this economy. Here I am not talking about black BEE opportunists but rather true entrepreneurs from our townships who need the very same support that the Van de Merwes enjoyed during apartheid.
Is there such thing as free enterprise? Can this economy develop transform and be inclusive without political intervention? My answer to the former question is that there is nothing that exists that can be labeled free enterprise, it is an oxymoron. My answer to the second question is that in any nation, developed or developing, it is the politics that shape the economics and never the other way round.
In is evident to me that South African corporates are quick to want to exploit the black consumer base but slow to admit that the structures and management that they have are incongruent to the market they wish to exploit. Blacks remain consumers and accelerators of white success and hugely insane executive packages and share options and yet when those very same blacks seek economic emancipation and wish to graduate from being mere consumers to owners of the means of production, it becomes economic war.
There is no doubt in my mind that unless the socio economic barriers to black economic emancipation are deliberately removed and their demise accelerated by black activism; we shall continue to have two economies in South Africa: A first economy dominated, controlled and protected against any competition by white capital and a second economy, dominated, controlled by the first economy and occupied by a large generally poor black consumer base. Africa's perestroika must surely come or we shall all be damned.
Vince Musewe is an economist and you may contact him on [email protected]
Click here to sign up to receive our free daily headline email newsletter
