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. Last Updated: 07/27/2016

Re-Slicing South Africa's Pie

JOHANNESBURG, South Africa -- The telephone rings incessantly in Nthato Motlana's office. It is a new country out there, and a lot of people, particularly white captains of industry, are knocking at the door of South Africa's most prominent black businessman.


Perhaps the important thing is not so much that Motlana is a businessman as that he is a doctor, with a long-term patient and lifelong friend who happens to have been elected recently as the country's first black president.


The demise of white-minority rule and the advent of the Nelson Mandela era has brought white economic power face-to-face with black political control. This has shifted the struggle for racial equality in South Africa to a new and likely more protracted phase. With a cry of economic empowerment rising from the newly enfranchised, white South Africa is seeking to hold off direct government intervention in the market partly by making room for some prominent blacks in segments of the economy.


The telephone rings in Nthato Motlana's office, and the unmistakable voice of a white Afrikaner comes urgently over the speaker phone.


"Nthato, my brother, I've been trying to reach you for the past three days," the Afrikaner says. "We've got a business proposition for you that's worth 100 million rand ($30 million). We are trying to get a piece of land that has very rare minerals that cannot be found anywhere in the world except in South Africa."


After several minutes of breathless salesmanship, the caller persuades Motlana to see him in a few days. Motlana replaces the receiver, then rolls his eyes in mock exasperation. "This is the kind of thing I get every day."


These are busy days for Motlana, 69, the Soweto doctor and civic leader who lately has been receiving flattering attention and large infusions of cash from powerful white businessmen. In August he led an investment consortium to the Johannesburg Stock Exchange. New Africa Investments, with assets of $2 billion, is the first black-owned company to be listed.


The corporation holds controlling or substantial shares in the country's largest-selling daily newspaper, the seventh-largest insurance firm, and one of only two service providers in the world's fastest-growing market for cellular phones.


Motlana has been able to pull all this together in the space of two years largely as a result of what South African economists call "unbundling," in which the country's biggest conglomerates have sold peripheral assets to black investors.


This is becoming the main response of white business to popular clamor for reducing the staggering inequalities in the economy.


Centuries of white domination created one of the world's most racially skewed economies, with the 13 percent white minority controlling 98 percent of the nation's wealth. The country's most powerful company, mining-based Anglo-American, alone controls about 40 percent of the capitalization on the Johannesburg Stock Exchange. Just five corporations account for 80 percent.


Most sectors of the economy operate under a network of cartels -- from beer to mining to newspapers to cement.


White unemployment, the worst in 30 years, stands at an insignificant 4 percent. For blacks, the jobless rate is 50 percent. And the average black household earns $3,376, compared with $21,111 for whites.


"The difference between rich and poor in South Africa means the difference between white and black," Motlana says.


A trim, amiable man with a distinguished air, Motlana attended Mandela's alma mater, Fort Hare University, before obtaining his medical degree 40 years ago from the University of the Witwatersrand. While the entire ANC leadership was either in jail or in exile, Motlana became the voice of Soweto to the outside world. For seeming to be everywhere at the same time, Motlana faces increasing criticism.


"How is the black community in general benefiting from these deals?" asked Bheki Sibiya, director of Black Management Forum, an organization that presses for radical government measures to uplift large numbers of blacks. "Whites are shedding marginal businesses to a handful of blacks and giving the impression that something is going on. We need some traction, because at the moment there is a lot of wheel spinning."


Motlana begs to differ.


"My argument has always been that black economic empowerment will occur as we create linkages and partnerships with those already in power," he said. "I was attacked for this, but the Chinese say every journey begins with a single step."