It seems that black economic empowerment (BEE) is increasingly seen as an obstacle for overseas investors in South Africa, says Adv Anton Alberts, FF Plus chairperson and parliamentary spokesman on economics.
Adv. Alberts says the result of this is that economic growth is restrained which means that BEE is to the detriment of the average black person in South Africa. So far only a small group of black cadres have benefitted.
According to a recent report in the Bussiness Day, the European Union's Chamber of Commerce and Industry in South Africa said several aspects around BEE, such as the unrealistic requirements, makes it one of the 'big challenges' for European investors in South Africa.
According to the Chamber's National Executive Director, Stefan Sakoschek, one of the major obstacles is the requirement that state controlled enterprises will only consider tenders of companies with a 51% black ownership. He says it makes it difficult for many investors to resume business in South Africa, or to expand existing interests.
According to Sakoschek the Chamber supports continued economic transformation in South Africa through empowerment, but this process must be scaled down to ensure the long-term sustainability of investments. The Chamber has asked government for an 'urgent conversation' about the matter.
Adv. Alberts said the Chamber’s view underscores the FF Plus’ stance of many years that BEE has the opposite effect as contemplated, namely that it will harm the economy and deter investors which would lead to unemployment and poverty.
"South Africa cannot afford such obstacles on the path to economic growth. Government must abandon its short-sightedness over policies that do not work. If not, they will indeed be punished at the polls, "says Adv. Alberts.
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