DA ropes in younger Mbeki on economic freedom

By Carien Du Plessis 6 September 2011

The ironies in South African politics never cease to amaze. While former president Thabo Mbeki is the ANC Youth League’s new best friend, his little brother Moeletsi is cosying up to the DA. CARIEN DU PLESSIS heard out his tips to the opposition party on economic freedom in our lifetime.

Academic and author Moeletsi Mbeki’s name on the programme made the DA Gauteng caucus’s discussion on economic freedom on Monday an easy sell – to journalists at least. Seeing a Mbeki at a DA event was a first, although Moeletsi has surprised us in the past, such as when he rocked up at the convention where Cope was found, at the Sandton Convention Centre, very close to three years ago.

Mbeki the Younger, smiling disarmingly throughout, broke the ice by telling the intimate audience of about 50 journalists and DA politicians that “I never thought in my wildest dreams I’d be addressing a conference of the DA”, but as Chief Justice nominee Mogoeng Mogoeng said about his criticism during his weekend interview, “it shows that there is a democratic play”, Mbeki quoted with a smile.

And we all giggled, some even guffawed.

When interrogated about it afterwards Mbeki told Daily Maverick it was his first invite to a DA event: “I have no problems with the DA. They are a legal party and the official opposition. They sit in Parliament, they are practically part of the government of South Africa. Helen Zille as Western Cape premier sits in the Cabinet.”

Mbeki had two tips (he called them “motions”) for the DA: Support the ANC Youth League’s economic freedom campaign; and come out strongly against the capital flight by big corporations.

The DA’s guys agreed with him, kind of, but let’s first hear from Mbeki.

“This has been one of the most important threats to economic freedom in South Africa. It is not (ANC Youth League leader) Julius Malema, it is capital flight,” Mbeki said.

This was because “capital flight means there is no capital and savings in South Africa for entrepreneurs to develop their businesses”.

He added that there had never been an explanation for why companies like Anglo American Corporation, Old Mutual and South African Breweries had been allowed to list on the London Stock Exchange.

“On what basis did (the government) allow them to go, to move their primary listing from South Africa to London. Why did they approve it, what did they get out of it?” he asked. “This is proving to be one of the largest removal of capital gains, with the dividends being paid into another stock exchange.”

He later clarified, saying he didn’t believe there were kickbacks for the move, but he said there was never an explanation. (Some might suggest that he look no further than his brother, Thabo.)

He said capital flight happened when owners of assets felt vulnerable because of instability, possible seizure of their assets for nationalisation as well as nepotism, and they then tried to “buy” political leaders through corruption or through black economic empowerment deals, which Mbeki equated to corruption.

Capital flight was the biggest threat to entrepreneurship, which was necessary to create jobs. Economic development wasn’t about “bribing” political leaders, but about creating jobs, he said.

As for the DA’s support to the ANC Youth League’s economic freedom programme, he said the DA promoted opportunities for individuals, which is what economic freedom was all about.

Economic freedom “is about promoting entrepreneurship. You can talk to the Youth League about whether nationalisation is the right way”, he said.

But nationalisation wasn’t all bad. “Nationalisation cannot be excluded when you have an economy of cartels that block the entry of new players into the economy,” he said. “What Malema wants to nationalise, is the wrong thing (if the aim is to) promote economic freedom. Mines are not an obstacle to entrepreneurship, but an asset for entrepreneurship in that they are the largest earners of foreign exchange for South Africa.”

The DA agreed with him on most points, but it doesn’t seem they’re about to form an alliance with the Young Lions any time soon (although some might argue that the Youth League now needs all the friends it can get.)

DA MP Dion George, who spoke after Mbeki and after the tea break, said the big corporations were not to blame for capital flight. It is government which had to create a favourable climate for investment, he said.

He also gave a presentation of the DA’s plan for the South African economy, which includes a very ambitious 8% growth target.

DA MPL Jack Bloom, one of the organisers, afterwards said retired businessman Bobby Godsell was also supposed to have been there for the debate, but he couldn’t make it.

We wonder who will be taking part in the DA’s conference next? Malema, maybe? DM

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