If land hunger is the way blacks in Zimbabwe most acutely experience the legacy of white supremacy, in South Africa the comparable black experience is lack of access to capital. We either correct this shortcoming or we bid goodbye to any possibility of a prosperous and peaceful South Africa.
Apartheid set out systematically to destroy black South Africans’ ability to accumulate capital – whether as cash or other forms of property. In the process it hobbled the development of entrepreneurial skills. These consequences of a racially skewed system are now exacerbated by business practices which conspire to deprive millions of South Africans of access to banking – even as depositors, let alone as borrowers of capital. Banks believe the lower-income market – with its myriad small transactions – is less profitable than the big-business end. As a consequence we see banks moving branches out of areas where the poor – and the country – most need them. Clearly, the market is freer for some than for others.
The government has said often enough that job creation is the biggest challenge before us. It has said almost as often that established businesses will not provide the millions of jobs we need to create. Moreover, the government says it cannot itself create more jobs as this would mean unsustainable increases in state spending. What we are left with as the greater part of the solution to unemployment is massively facilitating new business. This means easing access to capital and providing people – in and after school – with the basics of business practice.
Our best and most innovative minds need now to be seized with how to develop an entrepreneurial society and culture that works, above all, for the poor, unlocking the talent and energy that are the most valuable resources of our people.
The operations of the government’s wholesale small business finance agency, Khula, need to be massively expanded to include direct lending to clients.
The Post Office can also play a huge role. While banks have been pulling out of some inner-city and rural areas, the Post Office has been expanding to more than 3000 branches. In an increasing number of these branches it is setting up Internet connections and business services, known as Public Information Terminals. It has more than three million account holders, with about R2-billion in savings held with it. Why not authorise the Post Office to run its own banking service, able not only to take deposits but to lend, to turn itself into the “people’s bank”?
The government should simultaneously press ahead with plans to require financial institutions to invest in communities from whom they derive profits. Banks and other institutions do, in our view, have community reinvestment obligations.
Patriotism may be an unfashionable notion in business in this global age, but we need nothing short of a national effort if our market place is to be anything like free.
UN mission must not fail
The United Nations mission to Sierra Leone is staring disaster in the face. With the debacles in recent years in Rwanda and Angola, what will be left of international peacekeeping initiatives on our continent if Sierra Leone should fail too?
In the space of a torrid few days, four peacekeepers have been killed and several hundred taken hostage, and the power- sharing agreement brokered in Togo last July with rebels of the Revolutionary United Front (RUF) is rapidly unravelling.
The UN could be forced either to up its involvement into “peace enforcement”, which will mean going into combat against the rebels, or to abandon its mission, which would certainly presage an even bigger disaster for Sierra Leone. Having finally become involved in trying to rebuild this tragic country after a lengthy, brutal civil war in which many tens of thousands of civilians were killed, tortured and mutilated, the UN must not even think of backing off now. Rather, why has it not learnt the lessons of its failed mission in Angola?
Since the UN mission was launched last December, Foday Sankoh, the RUF leader, has put the UN’s commitment to the test in a manner reminiscent of Unita leader Jonas Savimbi. The main disagreement is ostensibly about the pace and scope of RUF disarmament; but the prime issues are power and control of territory, particularly diamond-producing areas.
The 1600 Nigerians attached to the UN force are familiar with the undisciplined but fearsome rebel army of up to 15000 men and boys, and with the terrain, but the Indian commander and detachments from Zambia, Jordan, Kenya and elsewhere are new to the job. The 8000-strong force is still a quarter below strength and not fully equipped.
The United States and other permanent members of the Security Council have steered clear of military engagement in Sierra Leone. Britain, whose involvement has been minimal so far, dispatched 700 troops this week but stressed their role would be limited to assistance with evacuations.
Nigeria, the regional power best able to impose order, complains with justice that it received scant help with the costs incurred in its earlier involvement, and is hard put to do more. Unlike Australia in East Timor (or the US in the Balkans), no heavy hitter is prepared to show a military lead, to enforce the peace as the essential precursor to the reconstruction of civil society.
The dangerous reality is that the UN mission to Sierra Leone is undermanned, underfunded, undersupported and, at present, almost overwhelmed. The international community can and must do better than this. Its responsibility does not cease just because it is Africa.