This proposal is flawed for many reasons, but its main problem is that it does not actually help the cause it purports to. On the contrary, it actually negates it. Forcibly taking companies, or nationalisation, does not change the character of the current status quo but only replaces it with a politically correct colour – black.
In fact this whole effort is nothing more than a racist attempt by members of the cabal of the previous regime to force through their own acquisition of massive amounts of wealth. It is imperative to note that there is no dispute about the need to indigenise.
But it is finding a workable modus operandi that is causing so much consternation. People supporting the controversial indigenisation legislation often claim that white or foreign-owned companies are reluctant to incorporate blacks into the mainstream economy. Therefore, they claim, the new law is the best approach to redress racial imbalances in the ownership of the means of production.
In addition, they claim that, since the resources – particularly minerals in the case of mining companies – belong to the nation, indigenous people should not have to pay for anything.
It is instructive to note that most of the reasons proffered lack sound economic reasons. This is much akin to the controversial land “reform” programme, which was carried in out in similar circumstances where the sudden desire to empower purportedly landless blacks overrode all genuine economic concerns about the likely consequences.
The economy is still reeling from this disastrous decision and one would hope that the experience of this process should pressure our leaders to come to sound a decision despite political differences.
There is also an absurd assertion that the resources, particularly minerals, already belong to locals by virtue of being underneath our territory. Some seem to think that this actually makes sense. However it is one thing to know that you have these minerals and it is totally a different matter to extract them.
That is why a country like DRC, for instance, has huge deposits of much sought-after minerals but is still poor. Yet countries like Japan and South Korea are without much natural resource endowments, yet count among the richest nations in the world.
The latter two have the technology, expertise and most importantly the capital to harness these resources. This is where this indigenisation drive should be aiming at: building on skills, technology and knowledge transfer.
Proponents of this controversial law often charge that those who oppose it, particularly blacks, suffer from an inferiority complex and want to perpetuate the superiority of white. This is nothing but subterfuge designed to camouflage the growing list of blacks who have made it in their respective fields – and there are many of them.
The incorporation of blacks in senior management structures is now common, as is their presence on boards of directors. This is one way empowerment has become successful elsewhere. Most foreign owned companies now employ locals at all levels, even the most powerful posts in their companies. This naturally helps to bridge the knowledge and skills gap – a key aspect of true empowerment.
It appears greed and politics are at play – because unprofitable entities are being sold to foreign companies yet profitable companies are under pressure to cede controlling stake to blacks and with no apparent obligation to pay for the stake.
Opposition to this drive, both inside the government and outside, seems to have to put the brakes on, although the issue continues to be a major source of uncertainty and is negatively affecting the economy’s recovery. Empowerment has to be gradual if it to achieve its objectives. – Zimwara is an economics consultant. He can be contacted at: [email protected]Post published in: Opinions & Analysis