The Expansion of Black Business Into the South A^ I“ N Economy with Specific Reference to the Initiatives of Th National African Federated Chamber of Commerce in The
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THE EXPANSION OF BLACK BUSINESS INTO THE SOUTH A^ I“ N ECONOMY WITH SPECIFIC REFERENCE TO THE INITIATIVES OF TH NATIONAL AFRICAN FEDERATED CHAMBER OF COMMERCE IN THE Sheila May Susan Keeble Johannesburg, 1981 ii ABSTRACT Before the mid 1970s African business development was severely limited by Government legislation. This restriction resulted in a dependent African entrepreneurial class unable to compete with White business. The National African Chamber of Commerce (NACOC) formed in 1964 and the National African Federated Chamber of Commerce (NAFCOC), which evolved from this organisation in 1969, were established by Black businessmen who united to fight this restrictive legislation. By the mid 1970s they were in a position, as a strong, united, national commercial body, to press for changes and to initiate business ventures which gained them a place in the South African economy. Nevertheless, despite the co-operation and financial backina of White business, they were unable to bring about any effective changes in Government policy until after the Soweto riots of 1976. The concessions granted to Black businessmen after that time, together with the important role played by the National African Federated Chamber of Commerce, stimulated Black business development in the late 1970s although Black businessmen continued to fight for the removal of all discriminatory legislation affecting Black business. ACKtOflLEDGEMENTS To members of NAFCOC urd in particular Mr S. M. Motsuenyane (President) Mr S. Kutumela Mr S. J. j. Lesolang Mr M. J. Lefoka Mr M. Maubam To Mr J. w. Keeble, founder publisher of African Businas magazine. To Dr. P. L. Bonner for supervising this study. iv TABLE OF CONTENTS PAGE TITLE PAGE *■ ABSTRACT i i ACKNOWLEDGEMENT i i i LIST OF TABLES vii LIST OF ABBREVIATIONS viii NOTE ON TERMINOLOGY USAGE X PREFACE Xi NOTES XXii 1. THE AFRICAN CHAMBER OF COMMERCE MOVEMENT IN SOUTH AFRICA BEFORE 196 5 ......................... 1 INTRODUCTION: THE CHAMBER OF COMMERCE MOVEMENT .. 1 1.(1) The Early Black Business Associations ... 4 1.(ii) African Chamber of Commerce formed in 1955 ..................................... 9 1. (iii) Ikaheng (Zakheni) Finance Corporation formed in 1958 ........................... 15 1.(iv) Other Black Business Organisations formed in the 19 50s . ........................... 18 1. (v) Bigvai Masekela leadership .............. 21 1. (vi) Johannesburg African Chamber of Commerce formed in 1963 ................ 22 1. (vii) National African Chamber of Commerce formed in 1964 .... ...................... 27 NOTES .............................................. 32 2. CONSTRAINTS ON AFRICAN BUSINESS BEFORE 1970 .... 37 2.(i) Government legislation .................... 38 2.(ii) Regionalisation Directive ............. 65 2. (iii) Structural economic constraints ......... 70 NOTES .............................................. 81 3. THE FORMATION OF THE NATIONAL AFRICAN FEDERATED CHAMBER OF COMMERCE IN 1969 ...................... 85 3.1. First points of focus .................... 85 3.1.(i) The Implementation of Regionalisation ................. 86 3.1. (ii)Conferences ...................... 103 3.2. NAFCOC'S early attempts at negotiation with the Government ....... 110 3.3. Practical Action ......................... 123 3.3. (i) Buy-At-Home Campaign ........... 123 3.3. (ii) Bulk buying ..................... 132 NOTES .......................... ................... 140 4. NAFCOC' S FIVE YEAR PLAN .......................... 145 4.(1) Permanent Secretariat .......... 148 4. (ii) Membership ................................ 155 4. (iii) Income ................ i......... 167 4. (iii) (a) Small donations and prizes .. 173 4. (iii) (b) Donations for conferences ... 173 V 4. (iii) (c) Donations for particular projects ....................... 17 5 4. (iii) (d) Quid pro uo offers - business initiatives .......... 177 4. (iii) (e) S.A. Permanent Life Assurance Company ........................ 209 4 . (iv) Training .................................... 224 4. (iv) (a) Masekela-Mavi nbela Scholarship Fund ..... ........ 23 4 4. (iv) (b) NAFCOC Training Scheme ........ 239 4. (iv) (c) Banks business counsellors scheme ......................... 244 4. (iv) (d) Other train' g schemes ....... 248 4. (v) The Initiation of National Projects ...... 252 4. (v) (a) The African Bank ............... 253 4.(v) (b) African Business Publications.. 268 NOTES 282 5. SOWETO 1976 .......................................... 300 NOTES ................................................ 318 6 . SOWETO 1976-NEGOTIATIONS WITH THE GOVERNMENT ..... 321 6 . (i) New Deal Legislation 1977/79 - meetings with the Government ......................... 324 6 . (ii) Community Councils ......................... 339 6 . (iii)The Riekert Commission 1979 ................ 353 NOTES ................................................ 362 7. SOWETO 1976 - NEW WHITE PRIVATE SECTOR INITIATIVES. 366 7. (i) The Urban Foundation ........................ 366 7. (ii) Die Transvaler Dinkskrum.. ................... 772 NOTES ................................................ 380 8 . NAFCOC PROJECTS FROM 19 76 ........................... 382 8 . (i) The Blackchain Company ...................... 383 8.(11) African Development and Construction Company ..................................... 4Ci 8 . (iii)NAFCOC National Trust Limited .............. 410 8 .(iv) NAFCOC Industrial Development Corporation .. 412 NOTES ................................................ 419 9. PATH TO PROGRESS - ECONOMIC INTERDEPENDENCE AND THE HOMELANDS ................. 424 9. (i) Tripartites .................................. 424 9 . (ii) Southern African Economic Community ........ 440 NOTES ................................................ 451 10. NAFCOC PLANS FOR THE 80s ............................ 455 NOTES ............... 466 11. MODELS FOR ACTION ................................. 467 11.(1) Afrikaner example ..................... 467 11.(ii) American Black example ..................... 478 NOTES ................................................ 488 vi CONCLUSION ............................................. 491 APPENDIX 1 - PORTRAIT OF A BLACK BUSINESS LEADER - SAM MOTSUENYANE ............................... 503 NOTES .................................................. 536 APPENDIX 2 - Figures 1 - 25 .......................... 538 BIBLIOGRAPHY ...................................... 558 vii LIST OF TABLES PAGE 1. Estimated number of Households in South 71 Africa 1972 2. Remuneration of all employees 72 3. Claimed Average Household Income 72 4. Grossing up of claimed Household Income 1970 73 5. Estimated Budgets of White and Black Households in the main Metropolitan areas 74,7o 6 . Customers All Commodities Value spending by race by store type 76 7. Store type by region and area 77 8 . Preliminary Marketing Feasibility Study for Development of a Business Centre - Pimville Zone 7, Soweto - Black Households by Income 181 9. NAFCOC Accounts - Year ending 1979 222 10. Black businessman's opinion on the most pertinent limiting factors on the success of his business 226 226 11. Qualifications of Black businessmen 12. Business experience of Black businessmen 227 viii LIST OF ABBREVIATIONS AGOG African Chamber of Commerce A.C.V. All commodities value AD & CC African Development and Construction Company ANC African National Congress AN SC A African National Soil Conservation Association ASSOCOM Association of Chambers of Commerce of South Africa ATASA African Teachers Association of South Africa BIG Bantu Investment Corporation BMR Bureau of Market Research BOCOC Bophuthatswana Chamber of Commerce BOFCOC Bophuthatswana Federated Chamber of Commerce CED Corporation for Economic Development COL Cost of Living E.C.O.W.A.S, Economic Community of West African States EDESA Economic Development for Equatorial and Southern Africa F.A.K. Federasie van Afriz.aanse Kultuurverenigings (Federation of Afrikaner Cultural Organisations) F.V.B. Federale Volksbeleggingn GAZACOC Gazankulu Chamber of Commerce GST General Sales Tax G.T.C. Grocery, toiletry, confectionery ICC International Chamber of Commerce IDAMASA Independent African Ministers of Religion 1 Trade Union 1 Association Inkatha Inkatha Yenkululeko Yesizwe (National Cultural Liberation Movement XX Inqaba Ciskei Chamber of Commerce INSCA Indian National Soil Conservation Association Inyanda Natal and Zululand Chamber of Commerce JACOC Johannesburg African Chamber of Commerce MEL Minimum Effective Level METACOC Masihambisane - Eastern Transvaal Chamber of Commerce NACOC National African Chamber of Commerce NAFCOC National African Federated Chamber of Commerce NIOC NAFCOC Industrial Development Corporation NPI National Productivity Institute NRT Die Nasionale Raad van Trustees (National Council of Trustees) RDB Reddingsdaadbond SCCI Soweto Chamber of Commerce and Industry SOUTACOC Southern Transvaal Chamber of Commerce SSRC Soweto Students' Representative Council TAA Tanganyika African Association TACOC Transvaal Chamber of Commerce TANU Tanganyika African National Union T/0 Turnover TRACOC Transkei Chamber of Commerce TUATA Transvaal United African Teachers Association UCT University of Cape Town UNISA University of South Africa USSALEP United States - South Africa Leader Exchange Programme NOTE ON TERMINOLOGY USAGE Various Government Acts, such as the Bantu Land Act and the Native Trust and Land Act, have been given their original terminology although the words 1 Bantu1 and 'Native' have recently been replaced by the words 'Black' or 'Blacks'. xi PREFACE Black entrepreneurial