Much of the fault lies with the race-based employment equity and black economic empowerment rules that enrich a narrow and politically connected elite while impoverishing and greatly harming the black majority.
These rules, along with the destructive cadre deployment and tenderpreneurship they have spawned, have spread dysfunctionality across the public service, triggered the collapse of many municipalities, crippled Eskom and other SOEs, facilitated corruption way beyond ‘Zupta’ state capture, prompted an exodus of capital and skills, reduced growth to rates far below those in other emerging markets, and increased the number of jobless black people (on the expanded definition) from 3.2 million in 1994 to 10.3 million today.
Credentialed group (Blatant Elite Enrichment)
Like other race-based rules across the world, South Africa’s policies benefit only the most skilled and credentialed group, which comprises roughly 15% of the black population. By contrast, the remaining 85% of black South Africans have little prospect of ever gaining access to BEE deals, management posts, or preferential tenders at inflated prices. They are, however, continually harmed by all the adverse consequences of these rules.
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