Monday, September 5, 2011

The Negotiated Settlement

Last week, I set out to blog about my strong view that BBBEE needs to start wielding a very big stick. How BBBEE can no longer rely on the goodwill of white corporate SA to accelerate the effective participation of Blacks. Then I realised that I hold another view about where this actually comes from: CODESA.

CODESA is effectively the series of negotiations between 1990 and 1993 that ‘officially’ ended the apartheid system in South Africa. These negotiations took place between the governing National Party, the African National Congress, and a wide variety of other political organisations. Negotiations took place against a backdrop of political violence in the country, including allegations of a state-sponsored third force destabilising the country. The negotiations resulted in South Africa's first multi-racial election, which was won by the ANC.

In my view there were only two agenda items at CODESA: Political Transformation and Economic Transformation.  Obviously I was not privy to the discussions that took place there. I wasn’t even old enough to vote in 1994, let alone understand CODESA. I have, however, since seen a few snippets of Nelson Mandela telling FW de Klerk where to get off during negotiations. That was fascinating to watch. However, based on the policies that came out of the ANC on economic transformation post the 1994 elections, one started to see signs of what was perhaps agreed or more importantly, what was conceded!

Why am I concerned about the concessions? Well, it is my strong view that ‘our‘ victory over apartheid was somewhat undermined by what eventually became a ‘negotiated settlement’. Some may argue that the negotiations saved the country from what could’ve become a bloody and devastating civil war that would have taken the country back decades in infrastructure development and economic prosperity.

However, every negotiated settlement has concessions. No party gets everything they want in a negotiated settlement. The question we now have the benefit of hindsight to ask is: What exactly did ‘we’ concede, what was the real price of these concessions, and what do we have to do to reverse these losses?
Let me first say that I don't profess to know what the black political leaders were going through on that CODESA table. I am certain that they did the best they could at the time. I imagine though, that they would’ve carefully considered the concessions they had to make, against the wins they needed to secure. After all that's effectively what negotiation is about: You lose what you value less, in order to gain what you value more. Its a relative measure, not an absolute one. Everything is important, but certain things are critical. You secure the 'critical' and live with conceding some of the 'important'.
Back to the agenda. I am certain that economic transformation was a bigger debate at CODESA. The writing was on the wall in so far as political transformation was concerned. There would have to be free and fair elections to allow the people of South Africa to decide for themselves who shall rule. The economy though.... not that easy.
Fast forward a few years, and we start getting some indication on what was agreed on this thorny issue: Economic Evolution NOT Economic Revolution.
In summary, it was agreed that the Government of National Unity would chart a programme whereby Black people would be accelerated to become economically active and be part of mainstream economy. We would start with ownership. We would have a programme called Black Economic Empowerment. This programme would seek to have at least 25,1% of the economy transferred to Black hands over a period. The Nats probably thought: 'This would surely satisfy the call by the ANC for the people to ‘own the means of production’. The ANC was probably thinking: ‘It's not everything we want, but it's a start. Lets concede on this one, keep the economy stable. Tell our people there will be a process, whilst we get to grips with running a country. Besides we would now be running the state coffers!’
It's been 17 years since the first democratic elections. Where are we on this 'negotiated settlement' of Economic Evolution?
To fully appreciate where we are, let me preamble by restating the population demographics of South Africa, according to Stats SA’s mid-year Estimates 2011.
Mid-year population estimates for South Africa by population group. Mid-Year Estimates 2011
% of total population
40 206 275
4 539 790
1 274 867
4 565 825
50 586 757

Chew on these statistics as we review the state of economic transformation in South Africa today over the next few blogs!


  1. Hit it! Hit hard!

    Would be interesting to read when you unpack this one

  2. I wonder if the codesa documents are publicly available, would really love to bury myself in the economic element of the debate. Nice read!

  3. Very interesting article right more you have talent of putting words straight where they are needed