Affirmative Action in Africa

Since the end of colonial rule Zimbabwe and most African countries have been faced with a daunting challenge of leveling the business playing field .This is based on the historical imbalances that were created by colonial administrations which favored and promoted settler interests at the expense of all other citizens. Many nations have resorted to affirmative action which is has different names depending with the country. Affirmative action describes deliberate policies aimed at a historically economic and socio-politically sidelined group intended to promote its access to opportunities and resources. In particular black entrepreneurs have found it particularly hard to graduate into big, formal business enterprises. Affirmative Action is a moral and political question .The intervention of politicians and amendments to the laws has resulted in inaccurate and often misleading conclusions that Affirmative action is undesirable. Affirmative action measures were established to fight racial discrimination which prevented equal access to opportunities and resources such as land, minerals and mineral mining rights .

It is clear affirmative action was not some sinister plan invented in Zimbabwe and has been widely used in many countries. GMRI Capital reviewed affirmative action processes and programmes carried out in the USA, India, Nigeria , Canada, Sri Lanka ,Malaysia, Brazil and South Africa .In the Zimbabwean case a confusion arose due to the emergence of many political entrepreneurs who in turn have managed to overshadow social and economic/market entrepreneurs .Affirmative action policies address and redress systematic economic and political discrimination against any group of people that are underrepresented or have a history of being discriminated against in particular institutions such as banks, pension funds and Insurance firms in accessing loans and other credit facilities.

The world over a key objective of affirmative action is to redress negative effects of actual or perceived, past or current discrimination .The International Convention on the Elimination of All Forms of Racial Discrimination stipulates that affirmative action programs may be required of countries that have ratified the convention, in order to rectify systematic discrimination. It has to be noted this has to be done within the guidelines of the rule of law such that the legal framework has to be set up to support it. The disadvantages to people black entrepreneurs and the benefits to those entrenched in business are passed on to each succeeding generation unless remedial action is taken.

Affirmative action is not always popular and at times becomes a controversial subject .Opponents of affirmative action policies argue that they are based on collectivism and merely another equal form of discrimination because they can result in qualified applicants being denied an opportunity because they belong to a particular social group .Indigenization as it is called in Zimbabwe has been frowned upon by many as it has been associated with some perception that if you need affirmative action then you are not actually a qualified entrepreneur .This is both inaccurate and unfortunate as it ignores universally accepted facts that such redress is necessary if the business playing field is to be leveled and economy stabilized by including the majority in accessing opportunities and resources .

On the other side advocates and opponents of affirmative action agree that aim of public policy should be to achieve justice .In Zimbabwe and Africa this is paramount because there is a historic imbalance of resource and opportunity access especially access to business inputs and infrastructural support. Such imbalances are not healthy as they promote instability and resentment which often leads to counter productive friction within an economy. In addition lack of access to opportunity and resources is often detrimental to the economy as it limit’s the market participants and usually reduces aggregate demand which in turn reduces economic activity. As an example, most opportunities are heard about through informal networks of friends, family and neighbors. Since the results of racism are segregated communities, this pattern leaves people many Black entrepreneurs out of the loop for business venture opportunities.

In practice, the division between the market entrepreneur and the political entrepreneur can be blurred. Many business entrepreneurs share both characteristics in varying degrees. The term Political entrepreneur refers to businessman who seeks to gain profit through subsidies, protectionism, government contracts, or other such favorable arrangements with government through political influence more like influence peddling. This is also known as corporate welfare.In Zimbabwe and a some other African nations this has been a common problem .And the enjoinment of this to affirmative action has somehow blurred the merits of the programmes of affirmative action.

Over many decades discriminatory practices have led to a huge over-representation of certain ethnic groups which brought the need for affirmative action .Debates about affirmative action are about more than legal issues. Taking action to end racism as sought by affirmative action programmes is the challenge and responsibility for most African nation as they seek a more inclusive economic platform. Affirmative action helps mitigate the historical effects of institutional racism .Much of the opposition to affirmative action is framed on the grounds of so-called "reverse discrimination and unwarranted preferences."

Political entrepreneurship is used in a very different way by those that wish to contrast what they see as a pure "market entrepreneur" with someone that uses the political system to further a commercial venture or their own career. In the Zimbabwean and African context case this has been very difficult as it seems there is no escape of the political web if one wishes to operate any meaningful venture. The Government being the biggest customer for most services/products tends to exert influence on most enterprises and as a result it’s an impossible exercise to separate the entrepreneur’s class.

A social entrepreneur recognizes a social problem as a business opportunity, then uses entrepreneurial principles to organize, create, and manage a venture to make social change. Whereas a business/market entrepreneur measures venture performance in terms of profit and return, a social entrepreneur assesses success in terms of the impact on society. In the Zimbabwean and many African nations the market for most products and services is usually dominated if not controlled by the Government. And for any entrepreneur to make real progress there is usually a pre-requisite need to interact and seek government backing and support. This is how Affirmative action becomes imperative in helping Black entrepreneurs in Zimbabwe and Africa gain a foot hold in meaningful business ventures.

GMRI Capital reviewed several studies which showed Affirmative action just by itself can not be viewed as the ultimate solution for Black entrepreneurs seeking to enter big business in Zimbabwe and Africa. But it is an important part of the various steps that are required to improve representation of Black entrepreneurs in accessing resources and opportunities in a meaningful and notable way .Affirmative action will not eliminate racial discrimination, nor will it eliminate competition for scarce opportunities and resources. These programmes can not replace competence or the usual basics required to succeed in any business venture . Affirmative action programs can only ensure that everyone has a fair chance at the business opportunities available in Zimbabwe and Africa.

Gilbert Muponda is a Zimbabwe-born entrepreneur. This article appears courtesy of GMRI Capital. He can be contacted at gilbert@gmricapital.com. More articles at www.gmricapital.com