Questioning state and corporate motives should be routine

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The South African state has a long history of corporate entanglement. 

In the latter half of the 1600s, the Dutch East India Company established the first European settlement in Southern Africa, pioneering the expansion of the region’s colonial economy.

After the company’s collapse in the late 1700s, British imperialism in South Africa found its greatest champion in Cecil John Rhodes, who controlled the largest interest in mines in South Africa through De Beers. He eventually became governor of the Cape.

Cashing in on the discovery of Kimberley diamonds and Witwatersrand gold, a handful of companies gained power over South Africa’s development policy in the late 1800s. This became known as the minerals-energy complex. During apartheid, the minerals-energy complex enabled a few arms companies, banks and middlemen to profit significantly by assisting the military state.

All this to say that corporate interests have ruled South Africa before. And although the country’s capitalists don’t go about flaunting their power in nearly the same way as the Randlords might have, they have never quite let go of their influence. Today they may appear the benevolent saviours of a state in decline, but it’s always important to question what’s in it for them.

Early last week, business leaders, including the chief executives of some of South Africa’s largest companies, met President Cyril Ramaphosa to devise a way forward for the country’s ailing economy. Against the backdrop of especially meagre growth — 0.1% in 2023, according to some forecasts — and the real prospect of the state’s collapse, some sort of rescue effort by the corporate sector makes a lot of sense.

The meeting reportedly ended with the business leaders and the government agreeing to urgently work together to remove obstacles to inclusive economic growth and job creation.

According to a document outlining the collaborative approach, business has agreed to mobilise support — including, apparently, in the form of funding — to allow the government to square in on issues deemed immediate threats to the economy. These include load-shedding, the caving in of the country’s logistics system and crime.

The work will be directed through the myriad committees set up during Ramaphosa’s rocky tenure as president including the national energy crisis committee, the national logistics crisis committee and the joint initiative to fight crime and corruption and will be overseen by a joint strategic operations committee.

The latter committee’s secretariat is made up of director generals in government departments as well as some of the usual faces of South Africa’s business lobby, including Business for South Africa chair Martin Kingston, Discovery chief executive Adrian Gore, Business Leadership South Africa (BLSA) chief executive Busi Mavuso and Business Unity South Africa chief executive Cas Coovadia.

Of course, the aforementioned private-sector actors will be at pains to underline that their involvement in state affairs is by no means an attempt to interfere. The latter two — Mavuso and Coovadia — have quite recently had to make this clear after the business lobby was drawn into the so-called “Eskom files” scandal.

This after a News24 article alleged that the BLSA bankrolled the off-the-books investigation into corruption at Eskom to the tune of R18 million.

According to the news report, the intelligence reports contained untested allegations concocted by Tony Oosthuizen, a member of an apartheid-era secret military intelligence unit. The BLSA was allegedly convinced to do its part after George Fivaz, whose company was commissioned to conduct the investigation, suggested that Russia had a part in Eskom’s collapse. Fivaz denied this.

During a press briefing explaining the BLSA’s involvement, both Mavuso and Coovadia denied any overreach on the part of business. They suggested it was the sector’s duty to assist the state in rooting out corruption and rehabilitating the economy.

“I guess maybe in some corners that might be viewed as interference, but from where we are sitting it is not interference,” said Mavuso.

“And also because we understand that after the state capture project, we are sitting with a government and state owned entities that were intentionally hollowed out. The hollowing out means that some of the capacity that these institutions require for them to do what is in the ordinary course of business they are not in a position to do.”

“We don’t go out of our way to meddle,” Mavuso added.

But it is exactly the fine line between the private sector and the state that enabled the state capture project, a fact that we have to assume the business community is aware of given that a number in its ranks were implicated. 

Between a corrupt public sector and a voracious capitalist class, neither is untainted. The difference is that the former is mandated to look out for the public’s best interest — and we can hold them to account, if not through the courts, then at the ballot box. We cannot choose which silver-tongued business leaders have Ramaphosa’s ear. 

It is easy to explain away the role of the private sector in the government’s inner workings. After all, the backbone of any social democracy is its ability to balance the interests of business, labour and the people. Given Ramaphosa’s leanings, a more empowered private sector is something to be expected.

But, through fiscal consolidation and other policies aimed at winning back investors, the public sector’s share in the state has been greatly reduced over the years. There is no doubt that the state capture project helped speed up this process.

Moreover, the country’s once persuasive trade union movement seems to have lost its way, thanks, in par, to its own dalliance with big capital. With very little (although, hopefully, growing) coordination on the part of civil society, who is left to pick up the pieces? 

In our current conditions, in which any help is good help, we may be inclined to believe that we no longer have the privilege of being sceptical. But scepticism, both of the government and of the people driving its agenda, is a defining feature of a flourishing democracy — and something we should cling to, especially in the most difficult of times.