Category: Black economic empowerment (BEE)

Accelerated and Shared Growth Initiative for South Africa (ASGISA), Anti-business, Anti-poor, Black economic empowerment (BEE), Business incubation, Cooperatives, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, ECONOMIC POLICY AND STRATEGY, Enterprise friendly environment, Informal businesses, Job creation and unemployment, Land reform, Preferential procurement

Cyril on a tight-rope: Paradox, not policy certainty the outcome of the ANC conference

Will the honeymoon breathing space of optimism that the worst corruption is over and that more business-friendly policies and better public spending behaviour be utilised or wasted? With new reports of the ANC’s national executive committee setting wheels in motion to recall Zuma as president, it is important to note that acting against Zuma would still not set enterprise friendly policies in place.

South Africa’s post-apartheid ANC policies and strategies dealing with enterprise development have been largely driven by an increasingly unfriendly framework for established businesses as well as an anti-growth premise. In the final gasps of December 2017, the ANC Conference even took unanimously policy positions that makes mockery of Ramaphosa’s utterances of making growth the priority.

The decisions to endorse Zuma’s announcement on free tertiary education and to change the Constitution to enable expropriation without compensation, provide ample proof the ANC doesn’t understand what is required to ensure growth and to step back from the fiscal cliff.

Continue reading “Cyril on a tight-rope: Paradox, not policy certainty the outcome of the ANC conference” →

Accelerated and Shared Growth Initiative for South Africa (ASGISA), Anti-business, Anti-poor, Black economic empowerment (BEE), Black-owned businesses, ECONOMIC POLICY AND STRATEGY, Entrepreneurial activity, Job creation and unemployment, Land reform, Preferential procurement, Processors

Ready to choose a San hunter rather than a Sherpa guide for mountaineering? Dlamini-Zuma on Radical Economic Transformation

When Nkosazana Dlamini-Zuma announced her Manifesto for Change, she reminded me somewhat of the stern Mother Abbess singing “Climb every Mountain” for Maria (Julie Andrews) in The Sound of Music.

Definitely not her voice, but her words… Dlamini-Zuma summoned support for Radical Economic Transformation (RET): “We must know which hills to tackle next. …(t)hese are the mountain of economic transformation, the highland of land redistribution and the summit that must see us educating and skilling our people. If not, the negatives will swallow the gains we have made.”

Mother Abbess

Marvellous libretto…

Continue reading “Ready to choose a San hunter rather than a Sherpa guide for mountaineering? Dlamini-Zuma on Radical Economic Transformation” →

Accelerated and Shared Growth Initiative for South Africa (ASGISA), Black economic empowerment (BEE), Black-owned businesses, Developmental state, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, ECONOMIC POLICY AND STRATEGY, Enterprise regularities, Population size, Pro-growth strategies, Urban economy and growth, White monopoly capital theory

A Cyril Swallow does not make a Summer of Growth: How business friendly is Ramaphosa’s New Deal?

“We need to massify the creation, funding and development of black-owned small businesses, township businesses and co-operatives.” Cyril Ramaphosa’s New Deal for South Africa (14 Nov 2017).

This quote from Ramaphosa’s 10 point plan manifesto to get the economy growing forms part of the action steps under Point 5: “we must accelerate the transfer of ownership and control of the economy to black South Africans.“

At first take the creation of an immense number of enterprises sounds like a pro-business approach. But is this objective realistic? Will it render the desired outcome? Even more basic: is it sound economics?

The New Deal is silent on how this enterprise factory that will mass-produce black-owned businesses would work. Whilst the manifesto was announced in the context of the ANC leadership contest, the “we” that Ramaphosa refers to is clearly Government and its administrative institutions. Continue reading “A Cyril Swallow does not make a Summer of Growth: How business friendly is Ramaphosa’s New Deal?” →

Black economic empowerment (BEE), Business incubation, Cooperatives, Crime against business, Home-based businesses, Municipal efficiency, Preferential procurement, Public service delivery, Small enterprises, Sole proprietors, State Owned Enterprises (SOEs)

Government’s attempts to promote business formation as effective as a rain dance…

it would help more to combat crime effectively

Is the blind leading the blind when it comes to the promotion of black businesses? This question in my previous blog apparently ruffled a few feathers. Let us therefore compare the positive impact of Government strategies to stimulate business formation and the negative impact on business formation by Government’s failures in core governmental functions. Continue reading “Government’s attempts to promote business formation as effective as a rain dance…” →

Black economic empowerment (BEE), Cooperatives, ECONOMIC POLICY AND STRATEGY, Enterprise research, data and statistics, Preferential procurement

Is the promotion of Black Businesses done by the blind?

Government is pursuing numerous strategies to promote black owned businesses, e.g.:

  • The 80 Black Industrialists’ programme;
  • The Gazelles Programme (fast growing small enterprises that should increase their turnover and growth much faster than the market average);
  • The Cooperative Incentive Scheme;
  • Preferential procurement programmes;
  • BBBEE-measures effectively forcing large and medium-sized companies to subcontract to black owned businesses;
  • Sector Charters;
  • Grants and SEFA loans;
  • Land Reform and Restitution;
  • The Free State Provincial Grants Scheme and numerous other provincial initiatives,

and the list goes on and on… Continue reading “Is the promotion of Black Businesses done by the blind?” →

Black economic empowerment (BEE), Credit risk ratings, Investment/Divestment, Small enterprises

If you thought the S&P and Fitch downgrades scare investors away… Government’s security & protection deficit prevents a million local would-be entrepreneurs from investing

Whilst the downgrading of investor status by Standard & Poor and Fitch already drives foreign investment away from South Africa with capital flight from the JSE, at the local front ineffective crime prevention by the Government is one of the largest disincentives for enterprise investment:  a million people would have considered home-based businesses were it not for criminality. Continue reading “If you thought the S&P and Fitch downgrades scare investors away… Government’s security & protection deficit prevents a million local would-be entrepreneurs from investing” →