International Relations minister Ronald’s pompous posturing over some extemporaneous remarks made by new US Ambassador Brent Bozell served as a convenient media red herring to deflect attention from the IMF’s damning condemnation of the effect the ANC’s excessive regulatory requirements are having on economic growth.
In his prepared address, Ambassador Bozell emphasized the importance of what he termed ‘commercial diplomacy.’ But he cautioned that it required the right conditions, which could not be realized when “policies were structured in ways that introduce challenges to ownership, create complex compliance requirements and are clouded in charges of corruption.” That was how he referred to BEE.
On the same day, IMF economists delivered a similar warning to the ANC. Echoing Ambassador Bozell’s words, they stated: “Operating business in South Africa is significantly more burdensome, fragmented and costly than in peer economies” (Business Report, March 12). The concern of the IMF is the extent to which small and medium-sized enterprises, which are responsible for most job creation, are affected by the increasing regulatory burden imposed by the ANC.
This is evident in the new Business Licensing Bill, which increases the discretionary powers of officials at the municipal level, adding to an already overregulated system. That is exactly the kind of ideological, prescriptive overreach to which the Trump administration is opposed because it causes capital, innovation and entrepreneurship to seek greener pastures elsewhere.
Sadly, however, Ambassador Bozell’s advice to business leaders is unlikely to succeed. He urged them “to craft solutions, shape narratives and to advise the government on structuring deals.” As long as Cosatu, the SACP and the ANC remain ideologically committed to socialism, regardless of circumstances and prospects, they have no intention of adhering to either Bozell’s advice or the warning of the IMF. As Bozell observed, the outcome of such hidebound ideology is stagnation.
Thirty years of socialism have succeeded in entrenching and exacerbating poverty. Yet the ANC believes more of the same ultimately will prove successful. At least the National Party ultimately recognized that apartheid was unworkable and conceded power. The ANC is on the wrong side of history.
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