S. Africa's Catch-22 for blacks: no Marxism, and barely any capitalism

Does capitalism have much of a future in South Africa? A number of people here, both black and white, are working to see that it does -- even as others are predicting that most private enterprise will end when white (minority) rule ends.

And it is one of the ironies of the South African system that the white-minority government, which claims to be bitterly opposed to Marxism, is responsible for many of the stumbling blocks in the path of black capitalists.

Anyone needing proof of that assertion need look no further than an aging stone building in the heart of Johannesburg's financial district. It houses the African Bank, a six- year-old institution founded to help black entrepreneurs.

The bank, one of the few black-owned public corporations here, has just completed the second year in which it showed a modest profit.That happened despite a number of onerous government restrictions on the African Bank -- restrictions that are not placed on white-owned financial institutions.

Even the right to open an office in downtown Johannesburg required special exemption from the Group Areas Act, which allocates sections of urban areas for the exclusive use of one racial group or another. And, not surprisingly, the prime commercial areas of Johannesburg are zoned for whites-owned businesses only.

Similarly, the African Bank is only supposed to open branches in black townships and tribal reserves, which are for the most part dormitory towns or economic backwaters.

"So what happens, is that the bulk of savings that we need are put into white banks, which are more convenient," says the bank's general manager-designate, M. M. Maubane.

The government has granted selective exemptions of the Group Areas Act, allowing the bank to open "agencies" in white areas of Johannesburg and Pretoria. However, these offices can only have small staff and offer limited services. At the end of the business day, the agency's records must be transported to a branch in a black township for entry into the bank's official ledger. That is a cumbersome and complicated process -- but in the minds of government officials it prevents a black-owned business from gaining a foothold in a white area. (White-owned banks have had no difficulty in opening full-fledged branches in black areas).

Black businessmen are also hobbled by a number of regulations limiting the size of their shops and the areas in which they can build.

There have been selective relaxations of some laws and exemptions from others. Still, it has only been within the past year that Soweto, a city of some 1.5 million black people, got its first black-owned supermarket.

The government has created a plethora of development agencies to assist black entrepreneurs. But these tend to be compartmentalized. some work only in rural areas, others only in cities; some assist only Coloured (mixed race) or Indian people, others only Africans.

A Southern African development bank, which might take the place of some of these disparate agencies, is now in the planning stages, but observers say it is too early to evaluate the effort.

The same can be said for the Small Business Development Corporation (SBDC), a joint government-private sector agency that was the brainchild of tobacco magnate Anton Rupert.

There are a number of business development agencies connected with universities, too. One of the more ambitious is the Center for Developing Business at Johannesburg's University of the Witwatersrand. While the center sponsors a number of programs aimed at aiding black businessmen and helping them join management ranks, they are generally pitched at young people.

One such effort, for example, is a "young person's introduction to business." The program introduces black high-school graduates to subjects ranging from job interview techniques to the handling of stress in the workplace.

The center also sponsors a junior achievement program, in which teen-agers from all race groups form their own companies to market handmade products.

Program director Melanie Baleson says demand for junior achievement programs is fairly strong among students, regardless of race. "I would say they're most interested in making money . . . . They're all capita list at heart."

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