September 13, 2005

The IFP finds laughable the government's intention to review the policy of Black Economic Empowerment (BEE) in 2013, as announced by Minister of Trade and Industry Mandisi Mpahlwa. "It is a joke," contends Dr Lionel Mtshali who leads the party's caucus in KwaZulu-Natal Provincial Parliament, Pietermaritzburg.

The minister said the black economic advisory council established by the Broad-Based Black Economic Empowerment Act of 2003 will conduct a review and table recommendations to the President of South Africa and the Minister of Trade and Industry on whether the codes of "good practice should be discontinued" at the end of the 10-year period.

The IFP believes the minister's reasons for review, which appears to be routine practice rather than qualitative re-evalutation, are dubious. "Does the government expect to suddenly discover in 2013 that the BEE had been a waste of time? Does it expect to draw the very conclusions that independent observers, academics and opposition parties have been pointing out all along?" - asked Dr Mtshali.

The government's ambition to review a major piece of its economic policy after a decade of questionable performance renders it inflexible and casts the whole venture in an unflattering time-warp of central planning. The IFP is of the opinion that ten years is a rather long time to re-evaluate a policy that has generated so much legitimate criticism from all sides.

"The BEE, as we know it, has never been genuinely broad-based and instituting it in 2003 was already moving against the global tide of economic liberalisation," said Dr Mtshali. "It is not hard to imagine where this tide will take the global economy in 2013. At the same time, the South African government will be busy reviewing a hopelessly socialist experiment that others dismissed as a dismal failure ten years ago," said Dr Mtshali.

The IFP suspects that the government is in a clear denial of what the BEE really is. "For starters, the government is failing to acknowledge that the empowerment policy is discriminatory at heart. It discriminates not only against its clear losers among white and Indian businesspeople, but, most manifestly, among the truly dispossessed black majority. If the BEE, as it stands today, is not discriminatory, then we in the IFP do not know what is," said Dr Mtshali.

Contact: Dr Lionel Mtshali, 083 256 4902