Special Hearings — Business Hearings — 1997-11-11

NAFCOC SPEAKER: Maybe with regard to co-operation with other organisations, there was a time when the government did not allow COSATU, for example to communicate, to issue statements.  There was communication between Nafcoc and COSATU and the statements were issued through Nafcoc.  Nafcoc worked very closely with the ANC, some of the plans that Nafcoc brought to South Africa by way of trying to organise business, were joint responsibility between Nafcoc and the ANC.  So there has been a common objective between Nafcoc and liberation movement in particular.

DR RANDERA: Sorry, before my next question, can you just define this '3 4 5 6' plan of yours.  You've mentioned it

NAFCOC SPEAKER: Yes, the plan stated that by the year 2000, all companies listed on the Johannesburg Stock Exchange, must have at least thirty percent of their board members from the black community.  At least forty percent of their total shareholdings must be controlled by the black community, at least fifty percent of the value of the outside purchases must come from black owned suppliers and contractors and at least sixty percent of the top managerial and personnel must come from the black community.

DR RANDERA: My last question to you Mr Kongwane.  We've seen in other sectors, the legal sector, the health sector a move towards uniting of structures, so in the health sector we've recently formed a, we've seen the formation of a one organisation representing all doctors.  Looking forward rather than backward, can you tell us what's happening in the world of business.  Because one gets the sense still that the situation remains as polarised as ever, with the SACCOBs on the one side the AHI on the other side, SAFCOC and Nafcoc on the other side.  What sort of unity are we beginning to see in that field?

MR KONGWANE: I think black people are still very conscious of the fact that in the past there were partnerships which did not work for them.  However, I think what we are advocating for and what we believe in, is that any partnership that takes place between blacks and whites should mean really that there will be equity for all and Nafcoc supports that.  It is going very slow, obviously in most different business sectors.  Because blacks do not come to the table with much

NAFCOC SPEAKER: Can I just add

CHAIRPERSON: No, no press the red one please

NAFCOC SPEAKER: I think the most important question that we need to ask ourselves is whether there is a common message between the black and the white business today.  There was a question of property ownership which was exploited by the white business during the era of apartheid with the advent of the democratic government.  White business is taking advantage of acquiring properties in the former traditional,  in the areas which are traditionally black areas.  You take for example, oil companies not used to own garages, or service stations in the town ship by way of donating them to council, local council.  With the advent of the new government, everybody can acquire properties in the township, but we see oil companies, big business, competing with small business in acquiring those properties.  Now you have a situation where, those who never had are not given the space to acquire properties.  If you look at the many service stations that are emerging in the townships, they are not owned by individuals, they are owned by oil companies.  Individual or black in particular, stay as operators.  Now I think we should be saying to ourselves, when are we going to enable those people to actually acquire those properties.  Are we going to reconcile big business and small business when the democratic space that has been created , is being exploited, not in the interest of emerging businesses but in the interest of  big business.  We should be saying to ourselves, are banks position today, to empower the emerging business?  The answer is no.  They still behave as if we are living in the 1960's.  There is nothing of material nature, that will make small emerging business, to reconcile with big business because both who have got finances that is a bank.  These are serious questions that we will not be able to reconcile.  The big business and small business.  These are fundamental problems.
 There was a question of the wealth tax here, which the professor, so honourable put on the table.  These are issues that must be looked into, into in an integrative form and it may seem to be the direction if the government can legislate in a proper way.  Otherwise the struggle against big business will continue.  Small business will still be marginalised and they won't make any contribution by way of employing (unclear).
DR BORAINE(?):: Can I just make a comment.  In regard to your question, I think there's a certain level of maturity that needs to, that is needed because there are a number of issues on the table and it will take some time.  Even if you look at many of these empowerment deals, you'll find that a lot of it is not as kosher as it seems.  We see a lot of glorified managers running with some of these empowerment vehicles and they are not being fully empowered.  So there is a kind of maturity and commitment that should start to come from the established business sector and help us to start to overcome some of these issues.

DR RANDERA: Chairperson, will you allow me one more question.  I just want to take you back Mr Kongwane, and that's the history of the African Bank.  Could you please tell us a little about the difficulties that were encountered in setting up this bank, the problems that you encountered as you operated as a bank and of course the bank went under in later years, perhaps you could even give us some information about that.

MR KONGWANE: Thank you .  Mr Chairman, I just want to say the last mentioned point by my colleague here about wealth tax is not a canvassed position by Nafcoc, so it is an opinion and  I want us to understand that.
 Mr Chairman, in 1975, in fact beginning 1974, the founding fathers of Nafcoc, attempted to create a bank for themselves, as a vehicle for economic empowerment.  What we experienced those days, was that existing banks, and other financial institutions, created obstacles such as asking the government to raise the establishing fund and it took Nafcoc a long time before Nafcoc could in fact raise the kind of money which was asked by  the registeral(?) banks.  But Mr Chairman, after the bank was established, it didn't have a fair sail.  I think it is noteworthy to say, we hoped that the banking institutions in South Africa were going to train our management people, and they refused to do that.  But later in the years, when the African Bank got into trouble, I had a meeting with Dr Umsanyane and I asked him,
"What are the big banks doing and saying?'
and he said, I asked the then Minister of Finance, to ask the , and the bank was not in trouble really that time.  To ask some big banks to help us with management, so that we could salvage the bank out of trouble.  But he says, after a while this minister came back to say, these banks are refusing to lend us support and later 'cause the bank was under curatorship, and we were surprised to see some of these banks were interested in our bank, and this is how our bank was lost to us.  Thank you.