About this site

This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. It is the product of almost two decades of research and includes analyses, chronologies, historical documents, and interviews from the apartheid and post-apartheid eras.

2. Business and the white minority state

Historical roots

Ø     the development of large-scale deep-level mining in the 1890s;

Ø     the uneven emergence of capitalist agriculture in the three decades following the Anglo-Boer war; and

Ø     the industrialisation of the economy in the period 1920-1945.

Ø     The unequal racial distribution of the land, and the dispossession of the African peasantry, as effected by the 1913 and 1936 Land Acts, and the institution of a system of "Native Reserves" (the embryos of the later bantustans);

Ø     Control over the urbanisation of Africans and the racial definition of urban space under the infamous "Stallard principle" according to which black South Africans were allowed into the cities only to "minister to the needs" of the white population and were to be expelled from the cities when they "ceased so to minister". This was an embryonic form of influx control implemented through an array of pass laws;

Ø     The disenfranchisement of the African, Coloured and Indian population and hence the effective exclusion of the vast majority of South Africans from citizenship in the land of their birth; and

Ø     The use of the armed might of the state to suppress any resistance to this system on the part of the oppressed and excluded.

     "A [black] man cannot go with his wife and children and his goods... on to the labour market. He must have a dumping ground. Every rabbit must have a warren where he can live and burrow and breed, and every native must have a warren too."

     This was the system which apartheid sought to preserve and modernise after 1948.

     "Any change from the migratory labour system to stabilised urban communities would have a catastrophic effect on the Natives themselves... " (who) would be the first to oppose it.

Afrikaner business, the National Party and Apartheid

COSATU fights for a living wage while President P W Botha earns R 135 000 per annum

     "No longer to tolerate the destruction of the Afrikaner volk in an attempt to adapt to a foreign capitalist system, but to mobilise the volk to capture this foreign system and adapt it to our national character."

     Future NP Minister of Finance, Dr E Donges declared that the aim of the economic movement was "to increase by ten-fold the number of Afrikaner employers in commerce and industry". He was echoed by the later architect of apartheid, Dr H F Verwoerd, who argued that the taking possession of "state power" was the best weapon available in the "great struggle" to achieve the Afrikaners' "legitimate" place in commerce and industry - that of an employer of labour.

     "the meaning of non-white competition with white workers; the necessity for apartheid in industry; separate trade organisations; separate wage determinations; reserving certain occupations for whites; separate residential areas; job training for non-whites."

     "Natives in the urban areas should be regarded as migratory citizens not entitled to political and social right equal to those of whites. The process of detribalisation should be arrested. The entire migration of natives into and from the cities should be controlled by the state, which will enlist the Cupertino of municipal bodies. Migration into and from the Reserves shall likewise be strictly controlled. Surplus [i.e. unemployed] natives should be returned to their original habitat in the country areas [i.e. white farms] or the Reserves. Natives from the country areas shall be admitted to the urban areas or towns only as temporary employees obliged to return to their homes after the expiry of their employment... A national system of labour regulation and labour control will be established with a central labour bureau and an effective network throughout the country to allow supply and demand to operate as flexibly as possible and to eliminate the large-scale wastage of labour. A proper survey of the labour force and labour requirements will have to be made in order effectively to divert labour into the various channels of agricultural, industrial, mining, and urban employment."

Afrikaner undertakings

Table 1

Afrikaner percentage ownership in the private sectors of the South African economy, 1938-1975

SECTOR

1938 - 1939

1948 - 1949

1954 - 1955

1963 - 1964

1975

Agriculture, forestry, fishing

87

85.0

84

83

82

Mining

1.0

1

10

18

1

Manufacturing & construction

3

6.0

6

10

15

Trade & Commerce

8

25.0

26

24

16

Transportation

N/A

9.0+

14

14

15

Liquor & Catering

N/A

20.0+

30

30

35

Professions

N/A

16.0

20

27

28

Finance

5

6.0

10

21

25

Miscellaneous

N/A

27.0

35

36

45

Aggregate

N/A

24.8

25.4

26.9

27.5

Aggregate excluding agriculture

N/A

9.6

13.4

18.0

20.8

Source: D. O'Meara, Forty Lost Years: The apartheid state and the politics of the National Party 1948-1994. Randburg/Athens (Ohio): Ravan/Ohio University Press, 1996, p.139

+ = estimates.

"After many African countries became free they got dictatorships like [Idi] Amin's. We have to find a solution that won't end giving us one man one vote."

Non-Afrikaner business accommodates itself to apartheid

The military-industrial complex

"the resolution of a conflict in the times in which we now live demands interdependent and coordinated action in all fields military, psychological, economic, political, sociological, technological, diplomatic, ideological, cultural etc... We are today involved in a war... the striving for specific aims... must be coordinated with all the means available to the state".

"The lesson is clear. The South African Defence Force is ready to beat off any attack.... but we must take account of the aspirations of our different population groups. We must gain and keep their trust."

The only way to render the enemy powerless is to nip revolution in the bud, by ensuring that there is no fertile soil in which the seeds of revolution can germinate"

Paratus disclosed that the Demalcom was planning the massive increase in conscription proposed in the Defence Amendment Act of 1982. This included drawing up of guidelines for employers of national servicemen, to encourage employers to make up the difference between company salaries and national servicemen's pay. One researcher, writing in 1988, estimated that "most private companies currently do this, and… one-fifth continue to pay full salaries" - even though there was no legal obligation to do this. (Philip, "The private sector and the security establishment", p. 211).

Repression and reform

"by sensible representation but without the trauma of one-man one vote… Before the issue becomes one of a choice between isolation and total franchise, and nothing less, for God's sake get discrimination of all sorts and varieties out of the system totally, for all to see."

Ø     reforms that were perceived as being necessary from the perspective of business's profit-seeking interests. As Harry Oppenheimer said: "Nationalist policies have made it impossible to make proper use of black labour", "Business and Reform", Financial Mail, 6 September 1985); or

Ø     reforms that were, very self-consciously and cynically, designed to pre-empt the ending of minority rule.

a situation where people ten years from now feel things are going so much better for them that they do not feel anxious about political power." ("South African Alert", Business International, London, March 1988).

…we dare not leave it to the political processes only. We cannot place representatives of the disadvantaged communities in a position in which they feel obliged to challenge the interests of advantaged South Africans to seek redress". (Steyn, Managing Change in South Africa, with a foreword by H F Oppenheimer, Tafelberg, Cape Town, 1990, p.101). Reform is about depoliticising and diverting the aspirations of the majority, or at least of the majority's "representatives." (see also ibid. p.80).

Business support for intensified repression in the 1980s

Financial Mail, for instance. It reassured its readership that "No-one except the ANC is demanding political rights tomorrow."(12 October, 1984)

     "The imposition of the State of Emergency last year, and its recent renewal, though regrettable, were necessary." (widely published as an advertisement in many newspapers, example Independent, London, 14 July 1987)

     "The 60 percent increase in South Africa's security expenditure over the past two years was clearly essential in the circumstances. In fact, the damper put on socio-political instability by the security forces has definitely played a role in the recently improved performance of the economy."

Financial Mail concurred with these sentiments:

"Business confidence, that fragile reed, will probably be bolstered by government's latest crackdown on black dissent."

The use of cheap labour, child and forced labour

     "My son (who runs the farm) came to me and told me he did not have enough labourers. Then I told him to go to the principal of the Bantu school - it was during the holidays - and ask him whether every Bantu pupil, boys and girls, above the age of eight could work for him on the land the next day. And sir, they did that work as well as any big, fat grown up Bantu woman could do it and the work costs much less that way." (Hansard, vol 19, col 198, cited in Marcus, 1989, p.111)

Farm Schools

     "Whether farm workers' children are allowed to attend school or not, when farm or rural schools are allowed to operate, and indeed whether they are allowed to open at all, are all matters decided by the demands of the farmer. This does not only mean that school 'holidays' are timed to coincide with seasonal peaks in the production cycle, but that the school day itself is organised around the demands made on child labour during the working day…starting and finishing times are adjusted to ensure that school does not interfere with the work children are expected to do before and after lessons. Moreover, the farmer can (and does) prevent them from attending school, or plucks them out of the classroom at any given moment. Thus whether drawing directly on the farm, or indirectly through the collectivised child labour pools that country schools provide, restructuring has intensified and expanded the exploitation of child labour in the black worker family." (Marcus 1989, p.105-6)

This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. Return to the Nelson Mandela Centre of Memory site.