How government lost business buy-in
Investment has suffered due to limiting influence of big business, railroading small business and declaring wages and employment regulation off-limits in talks with economists, write Jeremy Seekings and Nicoli Nattrass
The ANC, when it took office in 1994, was deeply suspicious of business, while recognising its importance in the kind of mixed economy — essentially capitalist, with some state intervention — that it envisaged. Two views of business predominated within the ANC. On the one hand, business was seen to have been one of the pillars of apartheid, exploitative of workers and abusive of consumers. On the other, there was a growing appreciation of the weaknesses of South African capitalism, in particular its inefficiencies stemming from overconcentration and overprotection against foreign competition. The first view inclined the ANC towards the regulation of employment relationships, consumer protection, competition policy, the promotion of black business and price control. The second view inclined the ANC towards trade liberalisation and strategic interventions through industrial policy. Both views entailed a commandist approach to business in which the government would regulate or discipli...
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