LETTER: Is race policy worth trillions lost in activity?
If SA had grown at the 5% annual rate projected by the ANC, our economy would now have been 50% bigger
21 April 2024 - 13:40
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If the country had grown at the 5% annual rate projected by the ANC in 1994, our economy would now have been 50% bigger. This translates to a cost of R3-trillion per annum.
Our employment could have been higher by at least 5-million workers. At an average wage of R100,000 per year, this is a cost — largely borne by the less affluent — of R500bn per annum.
Why have we failed to fulfil our potential? The primary reason is ANC race policy. As in the past, employment — especially in crucial roles — has too often been on the basis of race. Yes, there were reasons for the racial preferences and targets (essentially quotas) that are embodied in our BEE laws. Redress for the sins of apartheid was necessary.
However, would such redress not have been better accomplished by prioritising growth over racial ideology? Were the benefits of pursuing race quotas in the workplace justified by annual losses of easily half-a-trillion rand in wages and R3-trillion in economic activity?
The obsessive pursuit of racial quotas has imposed — and continues to impose — enormous constraints on economic activity. As SA’s growth rate trends down to zero, is now not the time to abandon any ideology that is based on race?
Willem Cronje Cape Town
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
LETTER: Is race policy worth trillions lost in activity?
If SA had grown at the 5% annual rate projected by the ANC, our economy would now have been 50% bigger
The IMF has downgraded SA’s estimated economic growth to 0.9% in 2024, which compares poorly with its 3.8% estimate for Sub-Saharan Africa (“IMF warns global medium-term outlook weakest in decades,” April 16).
If the country had grown at the 5% annual rate projected by the ANC in 1994, our economy would now have been 50% bigger. This translates to a cost of R3-trillion per annum.
Our employment could have been higher by at least 5-million workers. At an average wage of R100,000 per year, this is a cost — largely borne by the less affluent — of R500bn per annum.
Why have we failed to fulfil our potential? The primary reason is ANC race policy. As in the past, employment — especially in crucial roles — has too often been on the basis of race. Yes, there were reasons for the racial preferences and targets (essentially quotas) that are embodied in our BEE laws. Redress for the sins of apartheid was necessary.
However, would such redress not have been better accomplished by prioritising growth over racial ideology? Were the benefits of pursuing race quotas in the workplace justified by annual losses of easily half-a-trillion rand in wages and R3-trillion in economic activity?
The obsessive pursuit of racial quotas has imposed — and continues to impose — enormous constraints on economic activity. As SA’s growth rate trends down to zero, is now not the time to abandon any ideology that is based on race?
Willem Cronje
Cape Town
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
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