dANCing to whose tune?

I have deliberately steered clear of politics because it doesn't particularly interest me.   However we are going through a very interesting time at the moment.  Some would even suggest that it is a watershed of sorts. 

We know that Zumachine Gun has declared that the ANC will rule until Jesus returns.  I this is the case then perhaps a second coming is a little more imminent than we initially thought.  I can only see that  a new party run by Shilowa and Lekota is going to be a good thing for South African politics.  This could be the first time in South Africa's political history where we actually have an opposition that poses a serious threat to the ruling party.  And in spite of the unnecessary warmongering from that esteemed matriculant Malema; the incumbent party is well aware of this fact.

What happens now and especially to BEE?

 We know that many within the ANC have been speaking about how BEE has enriched a few and that entrepreneurship is what the country needs.  There are even suggestions that the whole process will be reviewed.  Take a look at the ANC's Declaration of the Alliance Economic Summit (October 19 2008.)

Black economic empowerment needs to be subject to industrial policy objectives more clearly and explicitly.

As an aside just the words "clearly and explicitly" are likely to completely flummox the DTI. 

ANYWAY - as I was saying.

Both the ANC and the new splinter party are going to have to appeal to business for support and they will have to provide both local and international investors with a framework that is conducive for increased business activity, something that Trevor has been talking about for a while.  The R10 million that the Gijima guy gave the ANC is small fry in comparison with what some of the larger corporates, both public and private, are able to to contribute to a party.  And the party that makes the right noises will be favoured.

They can also expect that business leaders will no longer keep quiet like they did under the Mbeki government.  Reading Johan Rupert's column in yesterday's Sunday Times gives us a very clear idea of what we can expect from the private sector.  Rupert informs

I’ve kept my word to Mamphela Ramphele, who said that whites should start speaking out a little bit without having the fear of being branded racists.

And then he expresses the frustration of dealing with the Mbeki regime.

It was, however, becoming very clear that(Mbeki) was not well served by those close to him. He was never told the unpalatable truth and sadly lost touch with his constituents. Even “Big Business with Government” meetings were orchestrated “powerpoint exchanges”. It was not frank dialogue. And whenever any of us wanted to speak out our fellow businessmen made sure that we were kept quiet.

So even the business leaders were very reluctant to criticise, preferring the lobbying route.

And see where this got us. 

As another aside - I'm sure you remember that anti-crime campaign that FNB was about to launch early last year.  You know the one where they managed to irk the powers that be such that they had to cancel the campaign at the last minute.  The story that I heard was that senior cabinet ministers and ANC leaders were going to summarily withdraw the state's money from FNB.  It would have been in the billions and as a result would have caused a run on all the banks (Lehman anyone?).  FNB was persuaded to "reconsider".

Back to Rupert. I really recommend that you read this article because this is what we will have to do if we want our country to work.  It is the most balanced view of our economy that I have yet seen.  And because this is a BEE blog I'll include his comments on BEE and EE.

Black economic empowerment is a good idea. In South Africa, there has been a real shift of economic power towards black South Africans and that is continuing apace. Too often, however, empowerment has resulted in the enrichment of the few rather than the many, leaving behind a vast army of uneducated unemployed.

This can only be addressed by a far more effective nationwide programme of skills training. There are no unemployed carpenters, stonemasons, electricians or plumbers in South Africa, or anywhere else for that matter.

EE

We all want employment equity to work. It’s not only the right thing and the moral thing, it’s also the smart thing. Between 1994 and 2007 the numbers of black graduates has increased dramatically. I think by 2008 well in excess of 60% of all graduates will be black. The situation will resolve itself.

Now we’ve all seen and experienced the disasters of this policy of advancement at the expense of competence. Look at the institutions where experienced managers were “encouraged” to leave — Eskom, the Land Bank, South African Airways.

The senior leadership of various parastatals and parts of the civil service has been empowered to a point at which, in some cases, they can no longer deliver the basic services required of them. There has to be a successful mixture of old and new management for any of these enterprises to prosper.

Put that in your pipe jungle.

My final comments on this article and the split in the ANC is that they have got to replace elements of the stick for compliance with a suitable carrot.  I am quite sure that removing the stick won't have the desired effect but by changing the message from "conform or face the following negative consequences" to "conform and we will give you the following rebates, incentives etc" you will see greater and more meaningful successes.  Have you noticed how all BEE stuff is quietening down at the moment.  This is because companies are taking a "let's wait and see what happens" approach.  They must sense that the stick has been sent in for varnishing.  I totally agree with them.