News / Africa

S. Africa Pushes Economic Empowerment Program

A fruit vendor waits for customers at an informal settlement in Thokoza, south of Johannesburg, South Africa, July 18, 2014.
A fruit vendor waits for customers at an informal settlement in Thokoza, south of Johannesburg, South Africa, July 18, 2014.

Having won this year's election with more than 60 percent of the vote, South Africa's ruling ANC party -- in power for 20 years now -- is under renewed pressure to help the country's poor black majority.  Thuso Khumalo, director of South Africa's Broad-Based Black Economic Empowerment (BBBEE) program, as well as experts, have differing opinions on whether this program can ease inequality in South Africa.

From 1948 to 1994 South Africa went through apartheid, a brutal segregation system imposed by the country's white minority.  Under the system, black Africans and other non-whites were forced off their land and driven into bantustans, areas where they were totally disconnected from the country’s economy.

Since winning power 20 years ago, the ANC has struggled to fix the inequalities created by the system.  Twenty-three million of the country’s 51 million people still live below a poverty line of $58 per month and more than 16 million of these are surviving on government grants.

In addition, whites still control 80 percent of the country's land and 90 percent of the top 100 companies in the Johannesburg stock exchange.

This has caused anger among the country’s black majority, who blame the government for failing to ensure they have a fair share of the country’s economy.

But the government said its revitalized Black Economic Empowerment (BEE) program, now under the new name Broad-Based Black Economic Empowerment (BBBEE), was the answer to these challenges.

Incentives

The program provides incentives for companies to employ more blacks, promote them to management positions and give them shares in the firms they work for.

Companies are also given points for developing the skills of black workers and buying their supplies from black-owned firms.

Nomonde Mesatywa, who is chief director of the BBBEE in the Department of Trade and Industry, said the program could level out the inequality in South Africa's economy.

“It’s a redress program, in terms of restructuring the economic landscape by making sure that the patterns of ownership don’t remain in the minority but rather the black people start to participate effectively by owning shares and equity in big conglomerates that operate in the country,” said Mesatywa.

Some companies have been hesitant to implement the BBBEE codes as there are no penalties for failing to comply.

However, Mesatywa said large companies had a lot to gain if they complied with the BBBEE legislation.

“Obviously it gives them opportunity to benefit from government contracts and government procurement, because as you know generally the government is the biggest procurer of goods and services, so we are saying that, that it's like an incentive for companies, but beyond that the fundamental principle is that you contribute to the economic, social well-being of the country,” said Mesatywa.

Criticism

But this program has been criticized for enriching only a few politically elite.

Mashego Maleka, the CEO at Zenzele Technology Incubator, a company whose aim is to economically empower disadvantaged blacks, said BBBEE was a good program but its implementation needed to be revised.

“On the same time when there are the few that are benefiting, the bulk are burning the country, we have got black guys with mining rights, they cannot get funding because they can’t find market.  So for 20 years if you have got a mine, you want to export iron, you want to export coal, you can’t because you haven’t got a slot,” said Maleka.

Anton Baumann of Transcend Capital, a corporate finance house specializing in black economic empowerment transactions, said for BBBEE to be successful, trusts and charitable organizations should be brought in as partners in the ownership structure of companies.

“And the objectives of these foundations, trusts, could be either employee related, socioeconomic development related from addressing the poorest of the poor, building schools, hospitals, etc, or enterprise development related not an individual,” said Baumann.

Mesatywa said by encouraging companies to support entrepreneurs, skills training and employee ownership, the program would go a long way toward reducing the poverty and unemployment still affecting South African blacks.

You May Like

Yemen Brings US, Iran Closer to Naval Face-off

US sending two more ships to waters off coast of Yemen to take part in 'maritime security operations' More

Minorities Become Majority Across US

From 2000 to 2013, minorities became the majority in 78 counties in the United States. Here's where those demographic shifts are happening More

Japan's Maglev Train Breaks Own Speed Record

Seven-car 'magnetic levitation' train traveled at more than 600 kilometers per hour during test run Tuesday More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
New Brain Mapping Techniques Could Ease Chronic Paini
X
Shelley Schlender
April 20, 2015 7:03 PM
Pain has a purpose - it can stop you from touching a flame or from walking on a broken leg. As an injury heals, the pain goes away. Usually. But worldwide, one out of every five people suffers from pain that lasts for months and years, leading to lost jobs, depression, and rising despair when medical interventions fail or health experts hint that a pain sufferer is making it up. From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.
Video

Video New Brain Mapping Techniques Could Ease Chronic Pain

From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.
Video

Video Hope, Prayer Enter Fight Against S. Africa Xenophobia

South Africa has been swept by disturbing attacks on foreign nationals. Some blame the attacks on a legacy of colonialism, while others say the economy is to blame. Whatever the cause, ordinary South Africans - and South African residents from around the world - say they're praying for the siege of violence to end. Anita Powell reports from Johannesburg.
Video

Video Italy Rescues Migrants After Separate Deadly Capsize Incident

Italy continued its massive search and rescue operation in the Mediterranean Monday for the capsized boat off the coast of Libya that was carrying hundreds of migrants, while at the same time rescuing Syrian migrants from another vessel off the coast of Sicily. Thirteen children were among the 98 Syrian migrants whose boat originated from Turkey on the perilous journey to Europe.
Video

Video New Test Set to Be Game Changer in Eradicating Malaria

The World Health Organization estimates 3.4 billion people are at risk of malaria, with children under the age of five and pregnant women being the most vulnerable. As World Malaria Day approaches (April 25), mortality rates are falling, and a new test -- well into the last stage of trials -- is having positive results in Kenya. Lenny Ruvaga reports for VOA from Nairobi.
Video

Video Are Energy Needs Putting Thailand's Natural Beauty at Risk?

Thailand's appetite for more electricity has led to the construction of new dams along the Mekong River to the north and new coal plants near the country's famous beaches in the south. A proposed coal plant in a so-called "green zone" has touched off a debate. VOA's Steve Sandford reports.
Video

Video Overwhelmed by Migrants, Italy Mulls Military Action to Stabilize Libya

Thousands more migrants have arrived on the southern shores of Italy from North Africa in the past two days. Authorities say they expect the total number of arrivals this year to far exceed previous levels, and the government has said military action in Libya might be necessary to stem the flow. VOA's Henry Ridgwell reports.
Video

Video Putin Accuses Kyiv of ‘Cutting Off’ Eastern Ukraine

Russian President Vladimir Putin, in his annual televised call-in program, again denied there were any Russian troops fighting in Ukraine. He also said the West was trying to ‘contain’ Russia with sanctions. Henry Ridgwell reports on reactions to the president’s four-hour TV appearance.
Video

Video Eye Contact Secures Dog's Place in Human Heart

Dogs serve in the military, work with police and assist the disabled, and have been by our side for thousands of years serving as companions and loyal friends. We love them. They love us in return. VOA’s Rosanne Skirble reports on a new study that looks at the bio-chemical bond that cements that human-canine connection.
Video

Video Ukrainian Volunteers Search for Bodies of Missing Soldiers

As the cease-fire becomes more fragile in eastern Ukraine, a team of volunteer body collectors travels to the small village of Savur Mohyla in the what pro-Russian separatists call the Donetsk Peoples Republic - to retrieve bodies of fallen Ukrainian servicemen from rebel-held territories. Adam Bailes traveled with the team and has this report.
Video

Video Xenophobic Violence Sweeps South Africa

South Africa, long a haven for African immigrants, has been experiencing the worst xenophobic violence in years, with at least five people killed and hundreds displaced in recent weeks. From Johannesburg, VOA’s Anita Powell brings us this report.
Video

Video Apollo 13, NASA's 'Successful Failure,' Remembered

The Apollo 13 mission in 1970 was supposed to be NASA's third manned trip to the moon, but it became much more. On the flight's 45th anniversary, astronauts and flight directors gathered at Chicago's Adler Planetarium to talk about how the aborted mission changed manned spaceflight and continues to influence space exploration today. VOA’s Kane Farabaugh reports.
Video

Video Badly Burned Ukrainian Boy Bravely Fights Back

A 9-year-old Ukrainian boy has returned to his native country after intensive treatment in the United States for life-threatening burns. Volodia Bubela, burned in a house fire almost a year ago, battled back at a Boston hospital, impressing doctors with his bravery. Faith Lapidus narrates this report from VOA's Tetiana Kharchenko.
Video

Video US Maternity Leave Benefits Much Less Than Many Countries

It was almost 20 years ago that representatives of 189 countries met at a UN conference in Beijing and adopted a plan of action to achieve gender equality around the world. Now, two decades later, the University of California Los Angeles World Policy Analysis Center has issued a report examining what the Beijing Platform for Action has achieved. From Los Angeles, Elizabeth Lee has more.
Video

Video Endangered Hawaiian Birds Get Second Chance

Of the world's nearly 9,900 bird species, 13 percent are threatened with extinction, according to BirdLife International. Among them are two Hawaiian honeycreepers - tiny birds that live in the forest canopy, and, as the name implies, survive on nectar from tropical flowers. Scientists at the San Diego Zoo report they have managed to hatch half a dozen of their chicks in captivity, raising hopes that the birds will flutter back from the brink of extinction. VOA’s George Putic reports.
Video

Video Exhibit Brings Renaissance Master Out of the Shadows

The National Gallery of Art in Washington has raised the curtain on one of the most intriguing painters of the High Renaissance. Mostly ignored after his death in the early 1500s, Italian master Piero di Cosimo is now claiming his place alongside the best-known artists of the period. VOA’s Ardita Dunellari reports.

VOA Blogs