South Africa must end BEE and expropriation
Democratic Alliance (DA) leader John Steenhuisen laid out a six-point plan to reform and “turbocharge” South Africa’s economy, which hinges on ending fundamental and “destructive” legislation like the Expropriation Act and Employment Equity Act.
According to Steenhuisen, South Africa’s economy has been hamstrung by decades of mismanagement by the African National Congress (ANC), which, until 2024, had a monopoly on policy and implementation.
He said this resulted in economic stagnation, with South Africa’s GDP per capita declining over the past 15 years and unemployment remaining one of the highest in the world.
Steenhuisen said that South Africa can no longer afford to do nothing and continue down the same path, presenting an alternative plan that runs counter to fundamental ANC policies.
“At the core of the plan is pressure on the ANC to accept urgent reforms, and a commitment from the DA to do all we can to dismantle three major legislative barriers to growth,” he said.
These include the Broad-Based Black Economic Empowerment Act, the Employment Equity Act, and the Expropriation Act.
“While intended to advance transformation, these laws have increasingly served to entrench elite enrichment, deter investment, and block small businesses from accessing opportunities,” he said.
According to research by Prof. William Gumede of the Wits School of Governance, a conservative estimate is that about R1 trillion has been moved between under 100 people since 1994 under BEE.
“South Africa’s BEE model has created a model of corruption because people set up companies just to get a contract,” he said. “The same people have been empowered and re-empowered over and over.”
Further research by the Free Market Foundation (FMF) and the Solidarity Research Institute (SRI) showed that BEE has also been more widely destructive for the economy.
The groups argued that South African corporations forego 2% to 4% of turnover in direct BEE compliance costs, and that over nearly two decades, the cumulative drag on growth amounts to more than R5 trillion in lost economic activity.
The policies not only make it expensive to operate in South Africa, but the proceeds only benefit a few politically connected elite, while destroying growth and jobs.
Architects of anti-growth
According to Steenhuisen, the ANC has become the architect of “anti-growth” through its policies, prioritising political patronage and self-enrichment over economic inclusion.
It’s not only BEE, he said. “Destructive legislation” such as the Expropriation Act and Employment Equity Act have ramped up investor uncertainty and undermined merit-based appointments.
“Ideology has been prioritised over our economy, which is preventing South Africa from unleashing the true potential of its economy,” he said.
To counter this, the DA proposes sweeping regulatory reforms to establish a business-friendly environment that enables entrepreneurship, investment, and job creation.
This includes scrapping B-BBEE and replacing it with a non-racial economic empowerment model based on the internationally recognised United Nations Sustainable Development Goals (SDGs).
“This model will target poverty instead of race, ensuring that no deserving South African is excluded,” the party said.
In addition, the economic plan calls for the implementation of other key reforms to cut red tape, simplify business licensing and permits, and exempt SMMEs from bargaining council agreements.
The plan also seeks to improve access to microfinance initiatives, expand ‘One-stop Shops’, and remove import duties on essential business tools.
“These reforms will directly unlock economic growth and promote greater job creation,” it said.
Notably, this is just the first of six wider points on how to turn South Africa’s economy around. The broader plan includes:
- Removing job-killing policies and laws like BEE and Expropriation
- Ensuring affordable and reliable power by supporting competition
- Saving network industries like rail, road and ICT from collapse
- Performing a comprehensive spending review, including a payroll audit
- Saving local municipalities from collapse by ending cadre deployment
- Taking on crime, starting with state corruption and extortion networks
The full plan can be read here.
GNU for nothing
Launching the plan on Monday (11 August), Steenhuisen said that the DA would use its influence within the Government of National Unity (GNU) to push for action on the urgent reforms.
However, the party has frequently come up short when trying to convince the ANC and wider GNU to dance to a different tune.
While the DA is the second largest party in the GNU, it has repeatedly been steamrolled by the ANC, having little to no influence in swaying president Cyril Ramaphosa from doggedly pursing ANC policies.
This was evidenced by Ramaphosa signing the Expropriation Act into law, despite DA opposition.
The DA also suffered an embarrassing blow when Ramaphosa signed the Basic Education Laws Amendment (BELA) Act into law, unchanged, in December 2024.
The BELA Act was a “red line” for the DA during election campaigning, but ended up with a DA minister in charge of executing ANC-penned policies.
The party has also failed to stem the rollout of National Health Insurance (NHI), despite its stated opposition to the scheme.
The DA did hold some sway during the 2025 Budget saga; however, this did not come through its position within the GNU, but rather through court action challenging the budget process.
In reality, the party was completely sidelined and sidestepped by the ANC on the budget, which found majority support to pass budget 2.0 by getting smaller non-GNU parties on board.
At the ANC’s latest National Executive Committee meeting, the party resolved to restructure the GNU and dilute the DA’s influence even further by inviting more parties to join the grand coalition.
The DA has faced internal and external pressure to exit the GNU. Despite this, the DA said it will continue to push for policy changes through the coalition.
“The DA will relentlessly use our influence inside the GNU and Parliament to push for these reforms. It is time for urgent action. We must create economic growth and jobs,” Steenhuisen said.
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