Thursday, August 20, 2009

(MnG) Cope: Affirmative action misdirected

Cope: Affirmative action misdirected

South Africa's black economic empowerment (BEE) scheme, accused of merely shifting wealth to a few businessmen, should focus on the impoverished, the leader of the Congress of the People (Cope) said on Friday. BEE, designed to include more Africans in the mainstream economy after decades of exclusion, is one of the hot issues ahead of the April 22 parliamentary election.

Opponents of the ruling African National Congress (ANC) hope to capitalise on what critics say is the party's exploitation of the programme to enrich its officials. The ANC says it is looking out for the interests of the poor.

Millions of Africans still live in grim townships lacking the basic services and adequate housing the ruling ANC vowed to provide when it came to power at the end of apartheid in 1994.

The ANC is not expected to face any serious threat in the election, although the breakaway Cope has changed South Africa's political landscape, where the ruling party faces mounting pressure to tackle crime, poverty and Aids.

Cope leader Mosiuoa Lekota said on an talk show that those most in need of affirmative action were "the poorest of the poor" who live in shacks, accusing the ANC of ignoring them.

"Black economic empowerment [should be] providing effective programmes of education, training," said Lekota, whose party is seen as less inclined to be influenced by left-leaning unions and the South African Communist Party who support the ANC.

"You must produce entrepreneurs. You can't produce them unless you educate the rank and file poor people of this country."

While job quotas have successfully spawned a black middle class that has powered the economy by snapping up flash cars, homes and designer clothes, affirmative action has arguably stirred white resentment and accelerated the flight of skilled workers from South Africa to Europe or Australia.

Cope has made the same vague promises as the ANC on poverty and analysts wonder how committed the party is to tackling social and economic issues because its formation was seen as part of an ANC power struggle, not policy differences.

BEE has long faced criticism for helping only a few blacks -- many of whom have strong links to the ANC, which is expected to win the April poll and appoint Jacob Zuma president.

Opposition Democratic Alliance leader Helen Zille described BEE as "just a fig leaf to disguise crony deployment".

"And when the cronies fail, poor people suffer," she told the Mail & Guardian.

Under black economic empowerment, which is now broadly accepted by corporate South Africa, firms must meet quotas on black ownership, employment and procurement.

It means bringing black investors on board and giving them an equity stake usually via complex deals funded by the company, banks and existing shareholders through the issue of new shares. -- Reuters

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