Peddlers of BEE poverty at odds with reality, says IRR

The Institute of Race Relations (IRR) has invited the World Bank to engage in discussions on the kind of country South Africa could be if it adopted market-friendly, pro-growth, and pro-enterprise policies. 

The invitation is contained in a letter sent to the World Bank yesterday, following the publication last week of the bank’s report, Driving Inclusive Growth in South Africa, which identifies BEE as an anti-growth policy. Attached to the correspondence were three of the IRR’s eight Blueprint for Growth papers on how South Africa can unleash real economic growth. 

Says IRR Campaign Manager Makone Maja: “The IRR’s invitation was sent the day after South Africa’s latest and worrying GDP figures for 2024 were published, showing anaemic growth in the year of 0.6%. To achieve what South Africa can be, to create wealth, empower job creators, enable entrepreneurs, and see all South Africans become empowered consumers, we need 7% GDP growth every year. This is an ambitious but achievable growth target, if all pro-poverty policies, like BEE, are seen for what they are − investment disincentives, destroyers of wealth, and anti-enterprise policies – and scrapped.” 

Both the World Bank report and the IRR’s Blueprint for Growth papers flag race-rigged policies like BEE as barriers to economic growth in South Africa – with the poorest suffering the most from a weak economy with scarce and politically manipulated opportunities for socio-economic advancement. 

Says Maja: “Yet, instead of engaging constructively with the credible and empirically argued case against BEE, as presented by both the World Bank and the IRR, we have seen the peddlers of poverty use all manner of misguided and dishonest invective to try to undermine the pro-growth argument and the organisations that advance it. CEO of the Black Business Council Kganki Matabane is a glaring example of this. While ignoring the reality that BEE has worsened the livelihoods of the poorest while creating some of the wealthiest black South Africans the country has seen, and has cost our country vital job-creating investment, Matabane has the gall to suggest that the socio-economic reality validates BEE as an effective redress policy. 

“The reality could not be further removed from any such cynical rationalisation of BEE’s failures. The manufactured taboo status of BEE as a key to the economic upliftment of South Africa’s poor must be called out for its inherent dishonesty – and the IRR is glad the World Bank has seen fit to do so. Matabane himself bemoans the poverty that millions of South Africans endure, yet seems unwilling to ask why, after more than two decades of BEE, the vast majority of South Africans are no nearer to being as comfortable as Mr Matabane evidently is himself, or the members of the Council he leads. 

“To further the case against a policy that cynically exploits the poor while enriching only a connected elite, the IRR will engage high-ranking government and parliamentary officials over the coming weeks to promote a new vision of #WhatSACanBe. It is possible for the forces of freedom and prosperity to finally defeat the agents of poverty and indifference – but only if we dismantle the barriers to growth that are holding our country back. BEE is such a barrier. It’s time for it to fall.”

Click here to read the IRR’s letter to the World Bank.

Media contact: Makone Maja, IRR Campaign Manager Tel: 079 418 6676 Email: makone@irr.org.za

Media enquiries: Michael Morris Tel: 066 302 1968 Email: michael@irr.org.za