2005-11-28,+ANC+Incorporated+takes+over,+Msomi,+City+Press

City Press, Johannesburg, Business, 26/11/2005 19:53 - (SA) = ANC Incorporated takes over =

//THE ANC is in future danger of being mortgaged to private capital.//
 * S'THEMBISO MSOMI**

This is increasingly becoming a concern within and outside the party as more members of the ANC's powerful National Executive Committee (NEC) members join business.

This month alone saw high-profile NEC members Manne Dipico, Popo Molefe and Valli Moosa sign potentially lucrative deals with a well-established mining group and a giant gaming company, respectively.

Dipico, the former Northern Cape premier and President Thabo Mbeki's parliamentary adviser, owns 18 percent of Ponahola, a black empowerment company that recently bought 26 percent of De Beers Consolidated Mines.

The deal came as the relations between De Beers and the ANC-led government reached rock bottom, partly because of proposed legislation which would result in the state taking 8 percent royalty on diamond sales and impose a 15 percent export tax on unpolished diamonds leaving South Africa.

Dipico's involvement, De Beers must be hoping, would help mend the relations and probably lead to government softening its stance.

Molefe, the former North West premier, and Moosa, who was tourism minister until April last year, now own 7 percent of Sun International.

The three are among nine NEC members who have direct stakes in major companies or who serve on the boards of a number of conglomerates.

Add to that number the nine other committee members who have known business links through their spouses and the figure rises to at least 18 out of the 86 people who constitute the ANC's highest-decision making structure in between national conferences.

The list excludes party national chairperson Mosiuoa Lekota, secretary-general Kgalema Motlanthe and a number of other NEC members with business interests in smaller companies and family trusts.

The 18 out of 86 people sound negligible, until one considers the fact that despite its strong left-wing tradition, not even a single member of the NEC is a trade unionist or civil society activist.

Consider, too, the fact that of the nine active businessmen in the committee, seven are either former cabinet ministers, premiers or senior parliamentarians.

And with white business desperate to find black partners with the right credentials to be able to lobby government on their behalf, this trend is set to continue for years to come.

But is the rising business voice in the NEC, or any structure of the ruling party, a bad thing? Not necessarily, said Reg Rumney, a director at consultancy BusinessMap.

"What is good for business is not necessarily bad for the country," he said.

ANC spokesperson and NEC member Smuts Ngonyama, who himself is involved in business through the Elephant Consortium which has a stake in Telkom, is unapologetic.

"It is a right of any person to get into business. There is no law barring people from getting into business by virtue of them being members of the NEC. There is nothing wrong with it," he said.

The ANC, however, does recognise that the rise of the new capitalist class and its representation in the NEC raises a number of challenges.

Early this year, the party appointed a committee comprising, among others, Motlanthe, government spokesperson Joel Netshitendze and Stanlib chairperson Saki Macozoma. The committee's mandate is to formulate a code of conduct for party members involved in business.

One of the dangers of having so many NEC members involved in business, said political commentator Aubrey Matshiqi, is that it fuels perceptions that political power is the quickest route to personal wealth.

"Some may see being an NEC member as something that may give you competitive advantage over others. The worry is not that people engage in business, but whether they do so in a manner that results in problematic relations between the public policy process and private business relations," Matshiqi said.

Can an NEC member with a significant stake in a mining company remain "objective" when discussing a proposed new policy that may have adverse consequences for his company's bottom line?

Matshiqi also said the strong presence of business interests in the body could also encourage different political factions as members group themselves according to their economic consideration.

NEC member and SA Communist Party (SACP) general secretary Blade Nzimande said since the ANC is a "multi-class organisation", he does not mind having business involved.

"But the majority of the people who support the ANC are working class and the broader concern is that there is a danger that the leadership is increasingly becoming middle class and yet there is not enough working class participation at leadership level," Nzimande says.

Rumney said: "Most such parties begin as organisations dominated by unionists, but the longer they stay in power, the more they get involved in business," he said.

This is partly because people like NEC member and businessman Cyril Ramaphosa had been forced into politics, in the past, by circumstances.

They had no vote and were not allowed to operate businesses wherever they liked.

"Now that they are free to choose, some opt for business."

To Ngonyama, they are just continuing with "their role as the agents of change" beyond the confines of politics.

"There is no sector of society where members of the ANC should not participate. They are as responsible for economic transformation as they are for political transformation," Ngonyama said.

From: http://www.news24.com/City_Press/Finance/0,,186-246_1841155,00.html