I was thinking that when my Dell finally packs it in I would get a HP. They have been praised from the rooftops for dong this. Even old jungle jim has offered his two cents in today's Business Day (I know I said I wouldn't talk about him anymore but he is all over the newspaper all the time - I feel it is right to honour him. However I will keep quiet when he shoots his mouth off in October when the new EE reports are due).
The best commentary I have read so far came off the Opinion and Analysis section of the Business Day. The commentary makes the following very significant points:
- There was a strong likelihood that major international IT companies, whose South African operations are estimated to amount to about 1% of their global turnovers, would disinvest rather than share valuable intellectual capital with unwanted partners. In most cases disinvestment would have increased domestic technology costs while reducing employment and the transfer of skills to locals.
- Given the way BEE has evolved in SA, there is also a case to be made in favour of employment equity, skills transfer and affirmative procurement as the most effective means of improving the lives of ordinary South Africans, since so many equity transfers have served only to enrich already empowered blacks.
Regarding the first point, the dti has always had to tread a fine line between encouraging foreign direct investment and scaring it off by insisting on equity. I always wondered whether our immediate neighbours (other than Bob's fiefdom) were not making overtures to some multinationals encouraging them to move shop there because of BEE. Some multinationals will still find themselves looking for local equity representation - the financial sector is one example where both Deutsche Bank and Merrill Lynch have done equity transactions.
And the second point - anyone who has ever studied the rudiments of B-BBEE would regard this as obvious - it's a pity that so many people in government and corporate SA don't.
The dti gets a lot of flak (much of it well-deserved) for their various initiatives. But this time they have performed beyond expectations. Well done to them.
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