S.Africa: Black parasitism on Whites to get worse: SA under existential threat from the transformationists

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SA under existential threat from the transformationists

13 June 2025

Piet le Roux says govt seeking to make BEE and EE into prerequisites for participating in any economic activity
Dear Funder,

The South African government is launching waves of attacks on productive businesses at an unprecedented scale.

In two speeches only days apart – one in Parliament, the other at the Black Business Council Summit – President Cyril Ramaphosa pledged to double down on transformationism and extend Black Economic Empowerment and other race-based economic sanctions into every industry.

The president committed himself, his party, and his coalition government to this path, despite months of intensive international and local opposition, as well as years of economic and fiscal failure.

Speaking at the same event, Ramaphosa’s minister of agriculture and leader of the second largest political party, John Steenhuisen, endorsed the Black Business Council’s BEE objectives without the least criticism.

As you know full well, the government’s transformation agenda has already had disastrous economic and social consequences. Expanding it will be a catastrophe exceedingly difficult to recover from, both for the white communities explicitly targeted by the transformationist project and for black communities ultimately suffering under the colourblind knock-on effects of political control over businesses.

Sakeliga and its partners in business face an urgent and existential decision:

Either we become the strongest organised business league this country has ever seen – and prevent transformationism from ruining the country – or we settle for making money on the way down, as our children emigrate, our communities break up, and society all around us decays and impoverishes.

The price of transformationism

During his speech in Parliament, president Ramaphosa said that he stood baffled at the suggestions that BEE had been economically harmful and should be scaled down.

This could only be baffling to a leader either willfully refusing to acknowledge the mountain of evidence piled up to the contrary or lacking understanding from prolonged sheltering from the hard realities of capital stewardship. Or both.

Studies have demonstrated for years what shareholders and managers already know: that subsidising special classes of shareholders in perpetuity substantially raises the cost of equity, kills off risk-taking investment, and encourages excessive reliance on debt funding.

The sectors most heavily regulated by BEE ownership requirements and race-based hiring and procurement have experienced sectoral GDP declines that extend beyond the definition of recession or depression, into a category more aptly described as collapse. Real mining GDP, which crudely approximates gross profit in the industry, is down nearly 20% from its highs reached during the last 20 years, utilities are down 22% (notwithstanding enormous taxpayer bailouts for Eskom), and construction has collapsed by a staggering 37%.

Business sectors that have been more difficult to ensnare so extensively in transformationist policy, like agriculture, logistics, technology, and the diverse service sectors, have fared considerably better.

It should be no surprise, then, that it is precisely on these still relatively productive areas that the state is now focusing its transformationist attention. Doing to these sectors what has already been done to the industrial base will be nothing short of catastrophic.

My colleague, Sakeliga director and chief economist, Russell Lamberti, estimates that South Africa’s BEE-era economic underperformance (benchmarked to middle-income emerging market peers) currently costs around R2 trillion in forgone GDP value a year – and growing.

And that was under BEE-lite.

What explains the President’s commitment to disastrous transformation?

Despite the economic and social damage of policies like BEE and employment equity, proponents refuse to change course.

Why?

I believe it is a combination of three factors.

First, a genuine and legitimate desire to promote flourishing black communities in harmony with white and other minority communities has been distorted by a quest for black dominance.

President Ramaphosa styles this quest as a commitment to equality, arguing that “the ownership, the management, and the control” of the economy should “reflect the demographics of our country.” In practice, however, it is a distinct political goal to entrench a preferred political and ethnic hierarchy, not only in the economy as a whole, but inside every company and organisation.

Second, economic illiteracy leads to misguided beliefs that poverty is caused by a lack of access to the “means of production”.

This erroneous economics prevents the government from recognising that its policies of forced ownership transfers and forced hiring increase poverty among black people. The lack of understanding prevents the operation of what would otherwise be a constraining factor on transformationist ambitions. A negative feedback loop arises in which the government genuinely believes that the solution to more black poverty is more of the transformationism that ensures poverty.

Third, a vast patronage network of people seeking political paths to wealth has developed around the state.

This network is not just willing to keep BEE in place at public expense, and even at the acute expense of black communities, but demands more BEE. This group sees BEE as vital to its economic interests and is therefore a formidable lobby group and influence on the government.

Where the expansion is already visible

The current phase of the government’s transformation agenda is to turn BEE and Employment Equity into prerequisites for participating in economic activity, in what amounts to targeted domestic economic sanctions against white people and white-owned businesses.

Current or pending measures include:

Financial-services licences – insurers, asset-managers, and financial advisors at risk of being forced to keep set BEE scores to retain and obtain licences.

Medical & Pharmaceutical licences – enforcement of BEE for permits for medicines and equipment.

Real Estate – developers and estate agents would lose operating certificates without BEE credentials.

Agri-business – import and export permits increasingly require BEE compliance.

R100bn “Transformation Fund” – proposal for a central fund to absorb company ESG spending for race-based distribution.

Aviation licences – licensing councils working to tie BEE status to operating licences.

Competition approvals – merger consent hinges on racial-ownership targets and payments.

Employment Equity quotas – from September 2025, firms with 50+ staff must meet demographic ceilings that can cap white-male employees at 4%. Firms face crippling fines and prosecution for non-compliance.

Mining charter – draft rules raise already-onerous BEE thresholds even as the sector declines.

Enforcement powers – amendments aim to turn the BEE Commission into a tribunal with broad investigative reach and greater powers of sanction.

Sakeliga has already successfully pushed back some of these initiatives through legal threats (real estate, aviation, deal approvals), forcing bureaucrats to publicly confirm their lack of authority in a relevant industry (financial services, aviation), and launching active litigation against regulations and legislation (real estate, aviation).

Sakeliga’s strategy to combat these escalating threats

Unprecedented litigation against the state

We are currently undertaking a rapid escalation in strategic public policy litigation against the most dangerous regulatory threats to business and the economy.

We are on track to double our active court cases this year from 5 in 2024 to 10 by the end of 2025.

Unprecedented pressure for reform

Through our domestic business and industry chamber network and our newly established International Trade Office, Sakeliga intends to coordinate and scale local and international business pressure against destructive race-based political interventions in the economy.

We are strengthening important ties with business networks who are also working toward a favourable environment for business.

Alternative business ethics to strengthen opposition

We are developing and popularising alternative business ethics to harmful transformationism.

This involves understanding why and how race-based state intervention harms the common good, laying firm ethical and intellectual foundations for Maximum Appropriate Non-cooperation (MAN).

We are building out our reach in promoting sound alternative ethics by disseminating regulatory knowledge, explaining mechanisms of harm to a wide audience on various platforms, and providing legitimate avenues for dissent and opposition.

This strategy, developed with your support, has proven that it can deliver results.

Our 90% success rate in court has brought crucial relief over more than a decade on BEE procurement, municipal infrastructure mismanagement, lockdowns, property rights, and land invasions. Just threatening litigation has in many cases been enough to achieve real relief, such as when we forced Ebrahim Patel to withdraw his plans for CIPC business licensing requirements or when we made the Property Practitioners’ Regulatory Authority withdraw its BEE requirements for fidelity funds – all without needing to complete a court case.

Our international trade relationships and local chamber networks are resulting in escalating opposition and pressure for reform.

Our promotion of alternative business ethics is emboldening local and international businesses with the vocabulary and strategic framework for resisting harmful state requirements in favour of value-adding decisions wherever possible.

Sakeliga is today the best vehicle for businesses seeking impact against the harms of BEE and other transformationist policies. Responsible wealth creators with a vision beyond merely trading the decline can help us scale this impact.

How you can help

Scaling funding. We have experienced excellent funding growth in recent years, and many of you have scaled up your contributions generously as your confidence in our efforts grows. Where financially viable, your increased funding to match these escalating threats makes a real difference to the success of the Sakeliga mission.

Introduce new allies. I want to strongly encourage you to share this letter and an endorsement of Sakeliga with colleagues and friends. Ultimately, growing this audacious league of ours among those who want to secure a prosperous future for all our communities in the place we love is the only way this mission will truly scale.

Thank you for everything you have done so far. Your continued support energises and inspires the Sakeliga team to win.

And we must win.

Sincerely,

Piet le Roux

Chief Executive Officer / CEO
Sakeliga

Source: https://www.politicsweb.co.za/opinion/sa-under-existential-threat-from-the-transformatio

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