Herman Mashaba On What SA Entrepreneurs Need

Herman Mashaba On What SA Entrepreneurs Need


The SA landscape

South Africa’s economic trajectory is off course. When I co-founded Black Like Me in 1985, we were living under apartheid. As we were fighting to get out from under it, we faced some extreme challenges.

When Nelson Mandela became president in 1994, I thought things would change. They didn’t. At least, not enough. Restrictive economic controls are keeping South Africa and its people down. We need to change the way we do things.

Capitalism is not a bad thing

It’s time to change the way we think about capitalism as a nation. I firmly believe that we can free the country from poverty by making a firm commitment to capitalism.

As an entrepreneur, I think a healthy economy is crucial to the long-term success of a nation. And, because of this, we need to embrace capitalism and a free-market system.

This is the only way we’ll address extreme poverty and unemployment. Government tries to appease unions and keep communists happy while running a capitalist economy. It’s not possible.

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The country needs to make it easier for companies to do business

The current environment isn’t conducive to business growth because it’s overcomplicating things. SMEs are finding it hard to operate because of over-legislation. By over-regulating business, imposing a minimum wage and excluding groups from employment, government is holding companies back.

In its pure form, capitalism is not about exploitation, greed and nationalism. Instead, it’s all about creating jobs, promoting free markets, elevating the workforce and engendering a competitive economy.

The good news is that, for the most part, South Africa is a very capitalist society — even more so than many European countries. Ownership is important to South Africans — as much as 62% of households own their homes — and ownership is not a socialist characteristic.

Where are all the black entrepreneurs?

When the ANC came to power in 1994, I thought the barriers that were holding black entrepreneurs back from building businesses would disappear. Instead, black entrepreneurs are still struggling. Entrepreneurship has always been a big part of township life, so the knowledge and inclination is there, but legislation is holding people back.

Municipalities raid street vendors, for example, and complicated labour laws prevent SMEs from operating efficiently. What is the point of shutting a business down because it is incapable of paying minimum wages?

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The ideal environment

South Africa has a lot to offer. It is an English-speaking developing country, which makes it attractive for businesses. Our great weather and beautiful landscapes attract tourists.

We have the capacity to produce everything from textiles to automobiles. The key lies in creating an environment that encourages entrepreneurs, like myself, to do business. By doing this, profits will be made and jobs will be created.

Humble beginnings

When I was growing up, we rarely knew where the next meal was coming from. In fact, we often knew that there would be no meal on the table.

This kind of poverty causes you to react in three ways: You become despondent, you become bitter, or you become determined to change your situation. I experienced all three, but it was a combination of determination, opportunity and very hard work that allowed me to escape poverty.


GG van Rooyen
GG van Rooyen is the deputy editor for Entrepreneur Magazine South Africa. Follow him on Twitter.