Needed: `Green' Investment in South Africa
Ecological disasters are a legacy of apartheid; returning multinationals should take the lead in planning for environmental protection now
WHILE President Nelson Mandela travels abroad to lure investors to South Africa, back home, life goes on as usual. In the backyard of one suburban home near Johannesburg, children play in a chlorinated swimming pool. The adults watch, sipping bottled water. Meanwhile, in a community of upcountry villages called Mafefe, a group of black children play in a fetid stream, splashing along the banks in mud tinted blue with asbestos from nearby mines.
The dawning of democracy doesn't change the fact that huge areas of the country where blacks live are environmental disaster zones -
a direct result of discriminatory economic development under apartheid.
Johannesburg's coal-burning power plant provides the city and white suburbs with the world's cheapest electricity, while children in the largely unelectrified black townships downwind breathe some of the world's most soot-filled air.
Overcrowding in the once-fertile former homelands - where 87 percent of the black population was forced onto reservations totaling 13 percent of the land - has caused deforestation, drought, and erosion. Now food crops barely grow. A British chemical company has dumped so much mercury in Natal's Umgeni River, the sole source of drinking water for thousands of blacks, that ``you can almost tell the temperature of the water just by looking at it,'' says one observer.
Post-apartheid South Africa is yearning for foreign capital to help revitalize its flagging first-world white economy and jump-start its largely third-world black one.
ENCOURAGED by Mr. Mandela's promise of an attractive business climate, United States companies from Apple to ARCO are poised to seize South African markets. But few investors may consider how critical the environment is to the country's social welfare, especially since many blacks will live for years to come by farming, fishing, and wood gathering. ``It would be sadly ironic if the new investment perpetuated our environmental and health problems, but this time under a democratic label,'' says Heeten Kalen, director of the South African Exchange Program on Environmental Justice.
According to South Africa's trade minister, Trevor Manuel, investors should expect basic environmental legislation. The new Constitution even includes the right to a clean environment - most Constitutions do not. But it will still take time to establish environmentally responsible investment standards. With nearly 50 percent of the population in need of jobs, the new leaders may end up less concerned about air quality in the eastern Transvaal than whether people breathing the air have jobs.
In any case, US investment could help change the country's racist legacy of environmental degradation. IBM spokesman Mark Halcomb says businesses returning to South Africa should focus on social improvement, including the environment. ``It's not totally altruistic. It will ultimately bolster the marketplace.''
Like IBM, a handful of US-based multinationals intending to invest, including Pfizer and International Paper, are considering ways to be ``green'' corporate citizens. Most prospective investors, however, look first at the business environment, not the natural one, says Daniel O'Flaherty, executive director of the US-South African Business Council. But investors should plan for environmental protection now, not later, when it will be more expensive and less effective.
Undoubtedly, Mandela's government will have to make some trade-offs between environment and development. Therefore, because American firms will be among the top investors in South Africa, they should take it upon themselves to integrate environmental safeguards into all investment, trade, marketing, manufacturing, and lending, without sacrificing the country's economic progress.
Let's hope US business will heed Harvard biologist Edward O. Wilson's call to ``give the invisible hand of free-market economics a green thumb.''