Recreated Black Business Council aims at giving financial power to the country’s majority.
The newly re-created Black Business Council (BBC) is the economic version of the ANC, says its president, Ndaba Ntsele.
Whereas the ANC delivered political power, the BBC hopes to give “the people” economic power.
Black people need to control the commanding heights of the economy, and this is the goal of the BBC. “Our intention is that black people should control the economy as the majority in the country,” he says.
The latest reincarnation of the BBC was born out of the disillusion of its members with Business Unity SA (Busa), which they felt was weak on transformation and dominated by white business interests.
This is in spite of the fact that the leadership structure of Busa is predominantly black, including both a black president and a black CEO.
The chairman of its transformation committee was young business mogul Sandile Zungu, one of Jacob Zuma’s most ardent financial backers when he was vying for the presidency of the country.
Previous incarnations of the BBC have also aimed at capturing the commanding heights of the economy. Ntsele, who is also CEO of Pamodzi Investment Holdings, has nothing new to say about how they are going to do it this time.
“We’ll do it the way the Afrikaners did it. They came together and they formed corporations. They put money together and they had access to funding. That is how you get control of the economy.”
Busa, which was formed in response to the Mbeki government’s plea that business should speak with one voice, is less focused on black or white control of the economy than on the immediate goal of growing the economy, creating jobs and developing skills.
Those skills won’t be developed in sufficient numbers until blacks control the big companies, says Ntsele. “How do people get skills? They get skills by being given the opportunity to fail.”
Because most of the big legal and accounting firms are controlled by whites, young black lawyers and accountants are not being given the same chance as their white counterparts to get skilled, he says.
He paints a picture of a largely white-controlled economy determined to keep black South Africans at a disadvantage.
That is why the BBC opposes labour broking, he says.
“Most of the big [white-owned and controlled] businesses prefer to use contract labour, so their employees are not unionised.”
To the argument that contract labour is essential to many businesses in the services sector, he retorts that (white-owned) restaurants don’t employ (enough) blacks as waiters.
When this is queried, he says, okay, maybe they do. But they’re foreign blacks, not South African blacks, because South African blacks would have to be paid more.
While Busa tries to transcend divisions between black and white business, to focus on what unites rather than divides them, doesn’t the re-creation of a “black business council” merely exacerbate the divisions? Shouldn’t he and his fellow travellers be moving in the opposite direction? “That would be the ideal,” he says. “Busa is the ideal. But once you’re inside, you see that things don’t work like that. Because we cannot ignore the fact that Busa was started by white businesses and black businesses.”
What’s the problem?
“The problem is, and I’m talking as a businessman, that when I buy into a company, I either have a controlling stake or I don’t have any control. We said we wanted equality; let’s come together and have the same vote. We couldn’t agree on that.”
Ntsele doesn’t buy the argument that it is increasingly meaningless to talk, as he constantly does, of black and white companies when more and more blacks are moving into senior management positions and directorships in “white” companies. And that through institutional shareholdings, there are more black investors in many of these companies than whites.
“There is no big black ex-white-controlled company that has a majority shareholding. There’s a difference between a black manager of a white-owned company and a shareholding. MTN might have a black CEO, but look at the shareholding. Who owns that company? It’s not black people who own the company.”
He acknowledges that black and white businesses face many of the same challenges.
“But it’s worse for a black business person because we don’t have a balance sheet. We’re not the same. Most black people don’t have a balance sheet. Our parents never gave us something that we could start a business with.”
Access to funding is the biggest single thing holding back the development of black business, he says.
“Why can’t they get access? That’s something we’re going to research and find out because that’s the biggest stumbling block.”
One route would be giving blacks title to more land against which they could borrow. Another is accessing the “over R1.1-trillion the government has announced for infrastructure spending. We must figure out how a part of that money is going to filter through to the black people of this country.”
The BBC’s eagerness to cosy up to government (no fewer than four cabinet ministers were given the floor, and celebrity treatment, at its recent founding conference) should perhaps be seen in this context.
“We’re an independent entity, but we’re going to work alongside our government,” he says, before providing a revealing take on a line from former US president JF Kennedy. “You know the famous quote that you must look not only at what the government is doing for you, you must also do something for the government?”
Ntsele, 59, who started his career as an entrepreneur selling newspapers, had plenty of access to funding when he needed it, even under apartheid.
“In the early 1980s, Standard Bank and Barclays gave me a lot of marbles to play the game. They gave me a lot of money. And they were white managers and white banks.”
He made lots of money building petrol stations and through property deals. His big break was securing the licence for Nike in Africa. In 2007, he was the Ernst & Young Entrepreneur of the Year.
His big dream was to control a listed South African gold company and, in 2006, he listed Pamodzi Gold “amid a flurry of trumpets”, according to a report in Mining Weekly.
But he ran it into the ground and, in 2009, it was suspended from the JSE and liquidated, with the loss of 13000 jobs. He blamed his failure on the “shenanigans” of the Industrial Development Corporation (IDC), which pulled the plug on him when he consistently failed to repay a R400-million debt. He appealed to President Zuma for “timely and decisive intervention”.
The IDC was “playing silly games with the lives of our indigent and desperate people”.
His version of events differed sharply from that of the IDC, and his credibility was left in tatters.
Is he the right man to lead the BBC’s assault on the commanding heights of the South African economy, then?
“As a businessman, you win some, you lose some,” he says. “One swallow doesn’t make a summer.”
Source: Sunday Times
Discussion
Comments are closed.