The head of South Africa's Black economic empowerment program plans to introduce additional incentives and potential fines to improve corporate participation and curb exploitation. The African National Congress is under pressure to improve the lives of Black people disadvantaged by decades of white minority rule.
Workers are seen at a construction site of a housing estate, ahead of the interest rates announcement decision by the South Africa n Reserve Bank, in Eikenhof, in the south of Johannesburg, South Africa , on Sep 19, 2024. JOHANNESBURG: The head of South Africa 's flagship Black economic empowerment plans to introduce additional incentives and potential fines to improve corporate participation and curb exploitation of the system meant to tackle the country's gross inequality, he said.
Two decades later, unemployment is five times higher for Black people than for white people and income inequality is the worst in the world, according to the World Bank, and critics say the empowerment policy has not worked. However, Matona says some companies inflate their scores by falsely listing Black people as managers, a practice commonly known in South Africa as"fronting", a crime under the law.
Matona said he hoped to enhance company incentives for compliance while"naming and shaming" and possibly fining those which fail to submit the reports. Economist Duma Gqubule said his research - based on an analysis of companies' annual reports and shareholding plans - found Black ownership of the 50 biggest firms listed on the Johannesburg bourse was barely 1 per cent, far below the official average figure of about 30 per cent.
His attempt to shift the focus away from ownership to skills development and training also has loopholes, consultants and trainees Reuters spoke to said.
South Africa Black Economic Empowerment Inequality Exploitation Incentives
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