by Ganesh Sahathevan
The best known of the new black elite are Tokyo Sexwale, once a communist and the former leader of the wealthy Gauteng province and Cyril Ramaphosa, who led negotiations for the African National Congress (ANC) with the apartheid government in 1994.
Sexwale, 51, drives a Jaguar and lives in a mansion in an upmarket suburb in Johannesburg and had trained with the Soviet Union’s military in the 1970s.
He later spent 13 years in prison with former president Nelson Mandela for his role in the anti-apartheid struggle.
In 1994, Sexwale was elected as premier of Gauteng province but was later lured into the private sector in 1998 when he established Mvelaphanda Holdings, which has interests in among others mining and financial services.
The value of Sexwale’s assets and other holdings are unknown, but his shares are estimated to be worth at least $223 million.
Sexwale and other ANC elites like he made a killing after they took power , and introduced into law black empowerment policies, which are meant to address "imbalances", in effect to reclaim from white South Africa what Africans see as being rightfully theirs. These policies are based on Malaysia's New Economic Policy affirmative action policy, which has also created a cohort of immensely wealth ethnic Malays.
The Voice referendum promoted by Labor MP Linda Burney and other First Nation elders, and backed by Prime Minister Anthony Albanese, can be expected to do the same in Australia, given its likely impact on every aspect of the economy, including mining.
The mechanism by which First Nation billionaires are likely to be created if The Voice referendum succeeds are relatively simple, and importantly cashless, as as has been demonstrated in South Africa and Malaysia.
END
Reference
Apartheid opponents strike it richOnce they fought against the apartheid government, but today many of South Africa’s former freedom fighters are being scorned for using black empowerment laws to become multi-millionaires.
The best known of the new black elite are Tokyo Sexwale, once a communist and the former leader of the wealthy Gauteng province and Cyril Ramaphosa, who led negotiations for the African National Congress (ANC) with the apartheid government in 1994.
Sexwale, 51, drives a Jaguar and lives in a mansion in an upmarket suburb in Johannesburg and had trained with the Soviet Union’s military in the 1970s.
He later spent 13 years in prison with former president Nelson Mandela for his role in the anti-apartheid struggle.
In 1994, Sexwale was elected as premier of Gauteng province but was later lured into the private sector in 1998 when he established Mvelaphanda Holdings, which has interests in among others mining and financial services.
The value of Sexwale’s assets and other holdings are unknown, but his shares are estimated to be worth at least $223 million.
Sexwale is one of a number of black politicians who have left the government to take up offers from the private sector.
Firms want recognisable black South Africans with political contacts to hold interests in their companies so that they can benefit from government contracts while complying with the empowerment legislation, requiring them to have more black representation.
Redressing imbalances
One of the ANC’s first tasks when it took power in 1994 was to draw up empowerment legislation to redress imbalances in an economy where whites held nearly all of the wealth.
Two of the most significant pieces of empowerment legislation that have been passed in recent years are the Mining Charter which calls for 26% of mines to be black-owned by 2012, and the Financial Services Charter which wants a quarter of the sector deracialised by 2010.
Ten years of democracy, yet many people are desperately poorTen years of democracy, yet
many people are desperately poor
The 52-year-old former mining union leader, Ramaphosa, also spent time in prison for opposing apartheid and was once named as a possible successor to Mandela before he accepted an offer from the private sector in 1997.
Today Ramaphosa, who is still a member of the ANC’s decision-making executive, is estimated to have a multi-billion rand fortune, with interests in mining and media.
Another black businessman who has made the most of empowerment laws is mining magnate Patrice Motsepe, who after signing several major empowerment deals is estimated to be worth around $500 million.
Motsepe initially built much of his fortune on his own and has never been directly involved in politics, but he does have senior contacts in the ANC.
Ramaphosa is his brother-in-law and his business tycoon sister, Bridgette Radebe, is married to an ANC cabinet minister.
Empowerment programme
The government believes that its empowerment programme is making headway.
The ministry of trade and industry says 10% of South Africa’s companies are now black owned, but critics say that only a few are benefiting.
Moeletsi Mbeki, President Thabo Mbeki’s brother and a top businessman recently complained that the government’s black economic empowerment programme had created a new and undeserving elite.
The opposition Democratic Alliance says that Sexwale and Motsepe were involved in 60% of the 42.2 billion in empowerment deals that were done in 2003.
Moeletsi Mbeki, President Thabo Mbeki’s brother and a top businessman recently complained that the government’s black economic empowerment programme had created a new and undeserving elite.
“We’ve created a powerful black elite that has its hands in many pies but at the end of the day doesn’t have the technical know-how of running the companies which they supposedly own or of which they are in control,” he said.
Good policy
Reg Rumney, an economist at BusinessMap, a research organisation in Johannesburg, said that only about 30 of 450 organisations listed on the stock exchange had significant black ownership.
“South Africa has a very good black empowerment policy, the problem is the way it plays out”
Reg Rumney,
economist
“South Africa has a very good black empowerment policy, the problem is the way it plays out,” he said.
Rumney said corporations were under pressure to bring on black partners and often the easiest way to do this was through one of the hard profile figures.
“We can see what is driving all this, but at the end of the day empowerment has to be much broader.”
Sexwale insists that empowerment is not a government handout scheme.
“Government has only provided the right legislative environment for black businesses to operate in,” he said in comments quoted by the Business Day newspaper.
“If you neglect the task then someone else will take up that role and we’ll be left with the misrepresentation of our history.”
SOURCE: AFP
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