18 May 2001

Ramaphosa’s black empowerment plan challenges government's economic strategy

South Africa's President Thabo Mbeki is considering how to react to the black empowerment report which effectively challenges the main precepts of official government policy and has been delivered by a major political rival, Cyril Ramaphosa. The plan seeks to resurrect the Reconstruction and Development Plan, unceremoniously bundled off the stage when the African National Congress came to power in 1994 and replaced by the current neo-liberal prescription. In the present political climate many local observers therefore view the Black Economic Empowerment Commission's report as a platform on which Ramaphosa can build a challenge.

The 'National lntegrated Black Economic Empowerment Strategy' criticises the record of Gear, the government's Growth, Employment and Redistribution plan, to which Mbeki has nailed his colours. The raison d'être of this policy has been to secure high rates of growth, but the black empowerment plan instead call the country's economic growth rate ”disappointing" and call for government intervention. It maintains that the development of black economic empowerment "has to be a state-driven programme' since it encompasses Reconstruction and Development Programme priorities such as job creation, rural development and infrastructure development.

Mbeki officially welcomed the BEEC report, produced under the chairmanship of Ramaphosa, when he presented it late last month, in the midst of allegations that he was plotting against the president. He is apparently still being investigated by the security service.

The publicity surrounding these accusations has revealed to public view previously unacknowledged power politics in the ANC, and the Black Business Council was this week seeking to avoid the potentially embarrassing juxtaposition of Ramaphosa and Mbeki on a public platform when the response to the report is made.

The report is a challenge to Mbeki's neo-liberal orthodoxy in a number of ways.

  • First, it rejects the central Gear role for foreign direct investment in securing the necessary growth rates. Instead it proposes forced domestic investment at high levels.
  • Then it rejects the reliance on the free market to engender growth; instead it calls for the state to direct key investment.
  • Finally, while in the main it seeks the development of a new bourgeoisie, it emphasises rural development through state intervention, black women's empowerment other human capital development and measures to increase employment.

Thus it has secured trade union support by its proposals for boosting employment in the privatisation process. Cosatu economists like Neva Makgetla have called it "holistic".

(SouthScan Vol 16, No.10)


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