Significantly, the charter’s provisions are voluntary, although
lucrative public sector contracts are at stake. The African National
Congress government has won praise for its stand-off approach. Memories
are fresh of its botched opening gambit on the mining charter that
threatened nationalisation of mineral rights.
John Coulter, head of JP Morgan in South Africa and chairman of the
Foreign Banks Association, maintains the need for the charter was never
questioned; the achievement has been getting something that everyone is
broadly happy with.
“It’s a short-term cost but it has to be seen as longer-term investment in transformation and economic growth,” says Mr Coulter.
The charter’s aims are broad: increasing black representation within
companies; increasing procurement spend to “accredited” companies;
expanding financial services to low-income households; unlocking up to
R75bn (US$7.5bn) for the financing of black-owned businesses; and
raising corporate social responsibility spending. The charter comes
into effect at the start of 2004 and will remain in place for 10 years.
