No, Germany is not waiting for South Africa to scrap its Black Economic Empowerment policy before investing

  • This article is more than one year old.
  • Published on December 7, 2018 at 20:58
  • Updated on December 7, 2018 at 20:59
  • 2 min read
  • By Tendai DUBE

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A widely shared post claims Germany will only invest in South Africa if the country scraps its Black Economic Empowerment (BBE) policy. There is no evidence to support this claim -- the German ambassador told AFP that the claim was false. The embassy added in a statement that “there is no instruction or guideline to withhold investment in South Africa”. A recent European Union discussion paper does however state uncertainty around the BEE as one of the top challenges for European investors in the country.

The Facebook post on November 21, 2018 has been retweeted 5,750 times, and shows over 1,300 reactions.

The claim depicts German President Frank-Walter Steinmeier and links to an article, which has no byline, and reads: 

“... the most important thing, is that Germany will not invest in South Africa as long as the discrimination of BEE (Black Economic Empowerment) has not been ‘scraped’.The German delegation proposed that black ownership requirements be relaxed for new foreign investors and for further investments by companies already in the country.”

a screenshot of the Facebook post on November 21, 2018

There are no quotes or named sources cited in the article, which can been seen here, on this website and on Facebook posts here and here.

BEE was introduced in a bid to overcome the dire economic inequalities that were a legacy of the apartheid era and to broaden participation in the economy, explains the South African Business Review journal.

Via a direct message on his verified Twitter account, the German Ambassador to South Africa, Martin Schäfer, told AFP the claim was “not true”.

He also tweeted the following on November 27, 2018. 

A spokeswoman at the German embassy in Pretoria added to AFP: "German companies are well aware of the rightful expectations in S.A. to contribute to economic and social transformation. 

“Thus, whilst not everyone might be happy with each and every facet of transformation including BBBEE, there is great understanding amongst the German business community that investments in South Africa come with social corporate responsibilities.”

“There is no instruction or guideline to withhold investment in South Africa; to the contrary, we wish South Africa to prosper and we encourage German companies to play their part in that."

Broad-Based Black Economic Empowerment (B-BBEE) is the second phase of BEE, which aims to increase the number of black people that own, manage, control and are employed in South Africa’s economy.

The contentious claim is partially copied from a press article published on November 20, 2018.

A European Union (EU) discussion paper published in September 2018 does speak to concerns around black ownership requirements but proposed “constructive engagement with the SA government” -- and does not cite “scrapping” the policy.

“EU supports continued economic transformation in South Africa through B-BBEE. The benefits of the B-BBEE, however, should be better understood through evidence-based analysis”, reads the paper.

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