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Push to scrap BEE in South Africa
3 hrs ago |
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South Africa's Democratic Alliance took aim at the country's black economic empowerment (BEE) laws, setting up a clash with the African National Congress with which it serves in an uneasy governing coalition.
The DA, the second-largest party after the ANC in the so-called government of national unity, said it will introduce an Economic Inclusion for All Bill to replace BEE legislation, as it had become a vehicle for state-sponsored corruption, theft and fraud.
The bill will "repeal all race-based preference preferential procurement provisions," and create a public procurement system that encourages genuine economic empowerment by offering incentives for tangible developmental, DA head of policy Mathew Cuthbert told a media briefing in Johannesburg on Monday.
The DA's proposal is likely to be staunchly opposed by the ANC, which views BEE legislation as key to its efforts to address persistent racial disparities in one of the world's most unequal nations and has repeatedly said it won't be rolled back.
BEE procurement rules encourage the government and companies to choose suppliers that are Black-owned or have strong black participation, as part of a policy to provide more economic opportunities to people who were marginalized during apartheid.
But critics say that it discourages investment, stunting economic growth and job creation.
South Africa's unemployment rate, which exceeds 33% is one of the world's highest and the economy has only grown by a feeble 1% on average for more than a decade.
The DA's proposal presents a fresh challenge to the 10-party GNU, which was formed after the ANC failed to win an outright majority in last year's election.
The ANC and DA have been repeatedly at odds over land policies, school admissions and cabinet appointments.
The DA's push against BEE is likely to antagonise its larger partner, but the party shrugged off any contradiction between serving in the GNU and targeting ANC policies.
"The DA may be in coalition with the ANC in government, but it doesn't mean we have to agree with them all the time," Cuthbert said.
The DA, the second-largest party after the ANC in the so-called government of national unity, said it will introduce an Economic Inclusion for All Bill to replace BEE legislation, as it had become a vehicle for state-sponsored corruption, theft and fraud.
The bill will "repeal all race-based preference preferential procurement provisions," and create a public procurement system that encourages genuine economic empowerment by offering incentives for tangible developmental, DA head of policy Mathew Cuthbert told a media briefing in Johannesburg on Monday.
The DA's proposal is likely to be staunchly opposed by the ANC, which views BEE legislation as key to its efforts to address persistent racial disparities in one of the world's most unequal nations and has repeatedly said it won't be rolled back.
BEE procurement rules encourage the government and companies to choose suppliers that are Black-owned or have strong black participation, as part of a policy to provide more economic opportunities to people who were marginalized during apartheid.
South Africa's unemployment rate, which exceeds 33% is one of the world's highest and the economy has only grown by a feeble 1% on average for more than a decade.
The DA's proposal presents a fresh challenge to the 10-party GNU, which was formed after the ANC failed to win an outright majority in last year's election.
The ANC and DA have been repeatedly at odds over land policies, school admissions and cabinet appointments.
The DA's push against BEE is likely to antagonise its larger partner, but the party shrugged off any contradiction between serving in the GNU and targeting ANC policies.
"The DA may be in coalition with the ANC in government, but it doesn't mean we have to agree with them all the time," Cuthbert said.
Source - Bloomberg
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