New job targets ignite political

More than 30 years into democracy, one of South Africa's most enduring and divisive fights is heating up: how to achieve post-apartheid economic fairness while growing the economy.

- By Lindsey Schutters

At the dawn of democracy, economic power in South Africa remained firmly in white hands, despite the fall of apartheid.

The ruling ANC adopted black economic empowerment (BEE) as a policy to change that.

Initially focused on ownership, often via high-stakes equity deals in established companies, the early BEE framework faced criticism for favouring a politically connected elite and often collapsing under financial stress.

The path to BEE was shaped by significant ideological shifts in the ANC. Although the Freedom Charter had called for sharing the nation's wealth, some perspectives suggest that BEE ultimately emerged as a “consolation prize” for the ANC’s abandonment of more radical socialist policies such as nationalisation.

These shifts followed Nelson Mandela’s pivotal 1992 visit to the World Economic Forum annual meeting in Davos, where the future South African leadership was exposed to market-oriented global economic thinking, and warned to avoid the fate of isolated economies such as Cuba and North Korea.

Oddly, while the policy is maligned by business now, BEE has its roots in corporate South Africa, with Anglo American pioneering early empowerment deals. These initiatives later evolved into a cornerstone policy instrument, initially focused on “deracialising business ownership and control”, as outlined in the ANC’s Reconstruction and Development Programme.

The early iterations primarily targeted increasing black ownership stakes in established white-owned companies through equity transactions, often using complex, leveraged financing structures that proved vulnerable during financial downturns.

A long and winding road