unitex@rubbs.fidonet.org (unitex) (09/12/89)
movement continued to protest with even greater vigour.
Asked if his recommendations should be seen as a "package", or
whether certain items had greater priority, he said that
fundamentally they were a package, but that the forthcoming debt
rescheduling was absolutely crucial and had to be accorded
priority.
MERLE LIPTON, of the Investor Responsibility Research Center, who
has recently published a book on sanctions against South Africa,
said that, according to conventional wisdom, South Africa was
suffering under sanctions. But South Africa's debt problem was
not necessarily due to sanctions; it was a problem which it
suffered in common with many other countries. Sanctions had
played a minor role in creating that debt.
She said that South Africa's economic problems would not be cured
by a lifting of sanctions. Despite the extra burden caused by
sanctions, South Africa was coping with its debt better than
many other countries, and had managed to increase its real
growth rate as a result of an economy restructuring. That had
led to an increase in unemployment, which would continue if
sanctions were maintained.
Over the long terms, there had been a decline in flows of
capital investment for most developing countries. Thus, even
with the elimination of apartheid, South Africa might have to do
without significant capital investment.
Asked about the views of white South Africans, Ms. Lipton replied
that sanctions had become a prominent topic. Opinion was mixed
and depended on the political views of those concerned. There
had been a long history of pressure on white South African
businessmen to reform apartheid. However, in recent years,
sanctions had somewhate lessened their activity.
JENNIFER KIBBE, Research Analyist, Investor Responsibility
Research Centre, said there was no denying the number of
corporations that had pulled out of South Africa since the
campaign for corporate disinvestment began. During the period
between January l984 and April l989, 277 multinationals withdrew
from South Africa, 155, of which were from the United States.
The real question to be examined was the impact these
disinvestments had had on South Africa. How had they affected
South Africa's economy, business, capital flows, employment
levels, labour relations and black economic empowerment?
Evaluating the last four-and-half years of disinvestment in
terms of those criteria led to the conclusion that the effect of
disinvestments had been minor at best, she said. First, an
overwhelming
proportion of the subsidiaries whose parents had disinvested
continued to operate under new ownership, creating little
disruption for South Africa in terms of production, employment
or tax revenue. Secondly, not only did most of the disinvested
entities continue to operate in South Africa, but a significant
number of them had retained access to their former parent's
products, technology and management expertise through non-equity
ties.
Concerning the effect of disinvestment on South Africa's balance
of payments, she said that, for the most part, South Africa's
dual exchange rate had protected it from a significant outflow
of capital. By requiring investment funds to be kept in a
financial rand pool, and only allowing funds to leave when there
was sufficient new investment coming in to replace them,
Pretoria had been able to stave off any dramatic effects
disinvestment might have had on its capital flow.
The effect of disinvestment on working conditions and labour
management relations had been negligible, she said.
Statistical and other evidence had shown that, on average,
working conditions and rates of black advancement did not change
noticeably after disinvestment.
While disinvestment had not had as much of an effect on South
Africa as its proponents had expected it had had several
unintended consequences, she said. Foremost among these had
been the further concentration of South Africa's economic assets
in the hands of whites. Another unforseen consequence of
disinvestment had been the practice of deals being negotiated
between buyer and seller behind closed doors, with the workers
being notified only after the sale was completed.
Another drawback had been the noticeable cut-back in social
responsibility and community development funds, as new owners
tried to rationalize their operating budgets without a parent
company's funds to rely on, she said. Not only had companies
cut back on social responsibility spending, but the new South
African owners were less likely than United States companies to
fund those organizations most actively involved in opposing
apartheid laws.
It was clear that disinvestment had not had the restricting
impact on South Africa's economy that was intended, she said.
Both multinational corporations and South African businesses had
adjusted to the disinvestment scenario; driven by self-interest,
they had managed to limit the potential damage by maximizing
their own benefits.
EUGENE NYATI, Director of the Centre for African Studies,
Johannesburg, said sanctions had led to the drying up of South
Africa's credit worthness. There had been a dramatic drop in the
activities of the South African Defence Forces in destabilizing
neighbouring African States. South Africa had decided to
withdraw from Namibia simply because it no longer had the money
to remain there.
He said that except for a trickle of European and black American
sportsmen and women who could not make a living in their own
countries, no sports figure of substance had dared to come to
* Origin: UNITEX --> Toward a United Species (1:107/501)
---
Patt Haring | UNITEX : United Nations
patth@sci.ccny.cuny.edu | Information
patth@ccnysci.BITNET | Transfer Exchange
-=- Every child smiles in the same language. -=-