Paper presented to a seminar held in London, in February 1976, under the auspices of the Christian Concern for Southern Africa (CCSA)
...Since the establishment of the Anti-Apartheid Movement in 1959, we have worked consistently for the ending of all collaboration with South Africa. Over the years, the most difficult issue has been that of economic relations and, particularly, investment and trade since they affect basic interests of the Western world. We approach the problem by pointing out that investment from overseas essentially helps to bolster the apartheid system in South Africa and that this constitutes a direct form of collaboration with that system. Many who suggest that reforms through investment may help to erode apartheid seem to ignore the fact that the South African economy is not operating independently of its wider political structure.
Overseas investment in South Africa is attracted to that country precisely because of apartheid, and not despite it, since that system produces such high returns for investment. In past years, when we were involved in making representations to British and other companies to withdraw from South Africa, they replied by stating that it was not in their economic interests to deprive themselves of the valuable opportunities to make profits through South African operations. The companies admit that they invest in South Africa essentially for high returns.
However, in recent years, with strong anti-apartheid campaigns focusing on the exploitation of black labour in South Africa, there has emerged the claim that investment can in fact be utilised as a major instrument to produce change within the apartheid system. Now, virtually all company chairmen claim at annual meetings that their operations in South Africa will help to break down the system of apartheid. Overnight, in the face of strong anti-apartheid pressure, a large number of companies are virtually claiming to have changed their priorities from that of seeking super-profits to becoming major agents of change. However, despite this apparently rapid conversion, all of them claim that the changes have to take place within the framework of South African society and that their companies have to operate within the apartheid laws.
Overseas investment bolsters apartheid
All the evidence in recent years shows that the companies operating in South Africa are continuing to function as partners in the apartheid system and we believe that the suggestion that they will act as major agents of change is merely a manoeuvre to try to legitimise their investments in South Africa and to facilitate the free flow of valuable capital to that country. It is important to examine in detail the precise role of overseas investment in South Africa. Each penny invested is certainly not just a single and once-for-all transaction. It sets up a pattern or structure of support which reinforces the apartheid system by a web of relationships.
Basically, as mentioned earlier, all overseas investments help to bolster apartheid. Through the payment of taxes to the South African regime, such investment enables the white power system to afford a vast machinery of coercion in order to keep the black population in submission. Overseas investors contribute directly to the vast resources expended in the police and military forces as well as in the bureaucratic procedures necessary to maintain white domination and race rule. Once capital has been invested in South Africa, it also begins to fuel trade so that there is a wider payoff. There is also the important question of technology since capital investment in South Africa takes with it modern technology which is not only restricted to civilian merchandise but is also becoming particularly significant in terms of South Africa's growing arms industry within the Republic. There is also the dramatic example of nuclear technology being transferred to South Africa from Western countries in order to assist it in developing its own nuclear programme including the possible production of nuclear weapons. The flow of capital investment from British companies to South Africa also takes with it a large number of skilled white experts, many of whom eventually settle in that country. Thus, capital investment in South Africa involves a whole set of other relationships, all helping to reinforce the apartheid system.
It is precisely because of this central role of capital in supporting the Pretoria regime that some business leaders such as Neil Wates in Britain have decided not to invest in South Africa. It would involve becoming active accomplices in the crime of apartheid. Once overseas investors already have a stake within South Africa, it is extremely difficult for them to withdraw their interest. Their stake produces good profits but faced with growing anti-apartheid sentiment in the Western world many of them are beginning to legitimise these investments by suggesting that they will become agents of reform. When challenged and exposed to the reality of the situation, they resort to claims that they will do "what little good they can" in the situation rather than "take the easy way out" by withdrawing from South Africa.
One of the most disturbing developments in the general debate about investments is the position taken by a large number of church leaders and churches: they are firmly opposed to the withdrawal of investment from South Africa and, instead, actively advocate a policy of producing reform through investment. Thus, we have seen the creation of a formidable unholy alliance between sections of the Church and those with business interests in South Africa jointly claiming that their efforts will help to bring peaceful change for the oppressed people of South Africa.
Normally, one would expect the Church, above all, to give a moral lead, but here we find also that a large number of these churches are themselves investors in companies which derive large profits from the oppression of the black people in South Africa. The policy of the World Council of Churches is clearly in favour of withdrawal but it has also suggested that member churches holding shares in companies with investments in South Africa may wish to utilise their share of power in order to help produce changes. There are two types of actions which can be taken by shareholders. The first type is to utilise shareholder power in order to expose, challenge, attack and confront, when necessary, those companies which operate in South Africa and thereby promote a wider public awareness while, at the same time, exposing the supportive role of investment. The second type, is the case of those who prefer to participate in gentle lobbying of companies at annual meetings and to discuss questions in board rooms with a view to persuading the company leaders to make certain changes in their operations in South Africa and who are satisfied with this objective. This type of action, whose aim is different from that of the former and which does not demand a withdrawal of investments, has very little success to show for its efforts.
Those who claim to work for changes through investment point out that their efforts can lead to African workers receiving higher wages. They go on to suggest that, with pressure, African workers can also be advanced up the apartheid ladder in employment so that they may constantly improve their position. Although those who advocate this view exaggerate its importance, it is relevant to ask why they do not, at the same time, work to stop the flow of white migration to South Africa. It would seem logical that if the purpose is to provide better opportunities for African workers, then skilled white labour from abroad should not be actively recruited in order to fill vacancies created in the South African economy. We find that among the most active recruiters of white skilled labour are the overseas subsidiaries operating in South Africa. It is well known that the Pretoria regime requires a growing pool of white labour to reinforce the power relationship of the white community in relation to the majority of the oppressed people. The role of companies in drawing overseas white labour into South Africa is to reinforce the apartheid system, not only by denying skilled jobs to African workers, but, also, at the same time, by providing additional whites on the side of apartheid, many of whom are subsequently recruited for the defence forces.
As far back as 1973, the Anti-Apartheid Movement wrote to a large number of churches which were then committed to work for change through investment. We suggested to them that they ought to secure a promise from the companies, in which they had investments and were actively engaged in lobbying, that those companies would not recruit skilled white labour. This demand should be met by the companies before any further negotiations were conducted with them. To our regret, the response from the churches was totally negative. It is clear then that those who are concerned with producing change through investment have to operate very much on the terms set by the companies investing in South Africa, which in turn claim that they have to abide by the laws and customs of the apartheid State. It is difficult to see, therefore, what kind of substantial changes can be brought about to advance African freedom through investment links. If the companies are not prepared to stop recruiting white skilled labour for South Africa, then there does not seem to be any grounds for expecting them to institute major reforms in their operations in that country.
In the growing conflict in South Africa, no sensible person now believes that one can expect any radical changes to come from the white community. Indeed, the whites are determined to defend, with total violence, the apartheid system which provides them with privilege and power. There is certainly no way in which South African society can be described as representing one based on consensus. Exclusive political power is held by the whites who constitute approximately 14 per cent of the population, leaving the rest of the so-called "non-white" people powerless. The growing confrontation in South Africa is basically a struggle for power taking various forms. In 1960, after the Sharpeville massacre, the nationalist movements were driven underground. From then onwards, the underground movements have had no option left but to conduct an armed struggle. This inevitability has also been accepted by the white regime which, since 1960, has been preparing for armed resistance from its own population. The white community today is mobilised for total war against its own people. But the armed struggle is likely to be a long one and is not the choice of the African people themselves. It is the intransigence of the white rulers that has left no option but resort to armed struggle. When African leaders speak of the armed struggle they do not mean that the struggle should only involve the use of arms - it also involves various forms of what would otherwise be described as non-violent methods.
The boycott strategy as a non-violent method of struggle
The boycott strategy as a method of counteracting apartheid was first initiated during the late 1950s. It rested on the fundamental premise that all links with South Africa serve to support the apartheid system and constitute a form of direct collaboration with white domination. In the nature of the South African conflict, external links with that country have the basic effect of supporting the side of white power directly. As South Africans, fighting the apartheid system, we consider these links to constitute a form of intervention in that conflict on the wrong side. It is our belief that, as the crisis grows in southern Africa, those with a stake in the apartheid system, including overseas investors, will stand more and more on the side of the white power system. Many of them will demand all types of increased intervention at new levels in order to maintain the stability and security of South Africa.
We do not wish international interests to operate in this form on the side of the white power system and we, therefore, ask all those with a stake in our oppression to get out of the arena of conflict and neutralise themselves in relation to the growing war. By having investments and other direct links with the South African regime, they are making the struggle much more difficult and certainly more violent than it needs to be. We say to those with interests in South Africa that if they cannot support our struggle directly, then, at least, they should withdraw their present support for the wrong side. If this is not done, then those with economic and other interests in the apartheid system will find themselves in direct confrontation with the liberation struggle.
Those who are opposed to a boycott of South Africa put forward the proposition that it is much better to build bridges with that country in order to exercise some influence over apartheid. They go on to say that one should prefer conciliation to confrontation. Of course, everyone would prefer conciliation rather than confrontation, but that is not the choice over South Africa. Here, we have a unique situation of a special form of internal conflict where there are two clear categories - the whites holding total political power as opposed to the majority black population. It is because of the nature of the internal conflict that external links, in effect, mean that they are links which operate in support of the white power system and dictated by their terms. It is precisely because these links do build bridges with the whites only that we are opposed to them. They do promote closer understanding - with the whites. They create a web of relationships - with the whites. They produce an ever growing alliance - with the whites. The relations with the oppressed people of South Africa which may be a consequence of these links are basically determined by white terms. The conditions of these relationships are set by them and the white regime will not permit any relationships which threaten to undermine its power.
In the South African context, it is precisely because bridge-building links develop a closer alliance with the apartheid system that we advocate the policy of boycott. The boycott is the most relevant and appropriate policy which can be adopted by those abroad, who wish to support the African struggle for freedom. It is a policy for disengagement from the arena of conflict.
Many of those who oppose the African liberation movements and boycotts claim that they are committed to peaceful change. No one would deny that it is far more preferable to have peaceful change than violent change. In a sense, we are all in favour of peaceful change. But we have to ask ourselves the central question as to whether peaceful change is possible in South Africa. It is also important to understand what we mean by change - what kind of change do we want in South Africa? There are those who hail the removal of particular instances of racial discrimination in relation to public parks and benches but this is not the kind of change which is meaningful to the oppressed people of that country. We want freedom and total liberation from the system of white domination.
Pitfalls of the status quo strategy
Those who advocate a policy of peaceful change in South Africa have to recognise that the kind of changes that are possible can only be those which take place within the apartheid context. They have to be at the pace and in the direction permitted by the apartheid system. It is, of course, essentially a status quo strategy whereby pressure may be put to help institute those changes which are acceptable to the white regime.
It is not, therefore, surprising that those Western governments which have close economic, political and military relations with the apartheid State are also firmly committed to peaceful change. Five years ago, we saw the expression of this policy by both President Nixon and Prime Minister Heath. Until then, many Western political leaders were claiming that it was not wise to interfere in South Africa's domestic policies. All of a sudden, leaders of major Western countries made special reference to the conflict in southern Africa and committed themselves to a policy of peaceful change. It is not altogether surprising that this commitment should be forthcoming precisely at a time when the armed struggle was developing in new forms in southern Africa. Certainly, the peaceful change policy of the major Western Powers is, in effect, an anti-liberation movement strategy.
Indeed, this peaceful change policy seems to involve supplying the apartheid regime with arms and is concerned with preserving the stability and security of South Africa. In addition, in recent years, there has been growing support in Western capitals for increased dependence on South Africa as a regional Power, which can be integrated further into overall Western global defence, particularly in relation to the security of the South Atlantic and Indian Oceans. This growing dependence on South Africa's defence role inevitably means that the major Western Powers need to preserve the stability and security of South Africa itself. Hence, if the internal conflict in that country raises the possibility of revolutionary change, then it is very likely that there will be very powerful tendencies in the major Western Powers to intervene further by providing more support to the Pretoria regime.
No one who has made a study of the southern African conflict can avoid the conclusion that the West is essentially on the side of the white regimes. And when we examine Western policy in relation to Rhodesia or Namibia, the inevitable conclusion reached is that policy with regard to both these territories is based primarily on what is in the interests of South Africa. If these tendencies of basing Western policy on the side of the white regimes continue, then it is likely to lead to a disastrous situation for the allies of the apartheid State.
Returning to the question of whether investments can be used to produce changes within South Africa, there are a few additional issues which need consideration. We do not understand how it can be argued that investments which are directly assisting the arms industry in South Africa should also be left intact because they may somehow also produce internal changes. On what possible grounds can it be argued that the contribution made by such investment to South Africa's military power is a contribution in favour of the black people? Is it really being suggested that if the arms firms in South Africa pay higher wages to Africans then that is an adequate reason for encouraging investments in the domestic arms industry? If, however, that is not the case, then why is it that the reform-through-investment advocates have not called for the withdrawal of such investment by British and other firms? Or, is it being seriously suggested that by negotiating with these firms it is possible to persuade them to stop their participation in the internal arms industry? It is a matter of serious concern when church organisations, including the CCSA, do not appear to be involved in calling for an end to military collaboration with South Africa through such investment.
Even for those who wish to bring about reforms through investment, it should not be difficult to see the special role of arms industries directly assisting the oppressive system of apartheid and providing it with considerable fire-power which is being utilised to threaten neighbouring African States. Furthermore, despite the fact that the major Western Powers, including Britain, continue to supply various arms to South Africa, we do not see the reform lobby acting on this question in order to effectively stop this flow of weapons from their countries to the Pretoria regime. Perhaps, if they were more active on such fundamental questions, it would be possible to treat their case with greater credibility.
A similar problem arises with regard to the question of recruiting skilled white labour from overseas for South Africa. If the companies concerned will not give a simple assurance that they will no longer recruit skilled white labour from abroad, then how can one suggest that these companies are genuinely concerned with improving African conditions and providing them with better opportunities?
There is also the whole question of new investment in South Africa, and those who advocate reform through investment do not suggest a freeze on all future investment until they have been able to assess more accurately the behaviour of companies in South Africa. Even within the context of the reform argument, this would appear to be an important interim measure.
Finally, on what grounds does the reform-through-investment lobby refuse to call for a withdrawal of investments from Namibia? The United Nations has declared that South Africa is in illegal occupation of the international Trust Territory and even Britain now states that South Africa's occupation is against international law. Is it being suggested that investment should be permitted in Namibia as long as it is possible to try and persuade companies operating there to increase the wages of Namibian workers? Does this mean that South Africa can remain there and that the reform lobby accepts its illegal occupation? If this is not the case, then on what basis did certain British church leaders enter into negotiations with Rio Tinto Zinc Company about the conditions of its workers in its uranium industry in Namibia? On these and other questions, there seems to be very slender evidence of any great commitment on the part of British churches to the liberation of the African people.
Political Role of Investment
Those who advocate reform through investment appear to ignore totally the political role of capital. Those with investments in South Africa, obviously, have a direct stake in the apartheid system. We have seen how the most active lobby in favour of South Africa is conducted in Western capitals by business groups with investments in that country. British companies, as well as their trade associations, put constant pressure on the Government, in order to ensure that it will not adopt policies hostile to the Pretoria regime. The vast resources of the United Kingdom-South Africa Trade Association are utilised in order to help promote South Africa's image abroad. Some business leaders and their corporate associations also make representations to Western governments to resume the sale of arms to South Africa in order to improve relations with that country. Some of them even become, overnight, experts on strategic questions and point to the so-called Soviet threat in the southern oceans which needs to be countered by relying on South Africa's defence role. Foreign policy is largely based on the perception of interests and, therefore, when a country has a large investment in South Africa, it is inevitable that that investment will produce powerful tendencies to preserve the status quo in South Africa.
Finally, even if certain limited changes can be brought about by retaining investment, what is the total cost involved? One has the duty to look at the total overall effect of overseas investment and not merely some changes which may come about in particular sectors. Is a slight increase in wages sufficient to compensate for all the other effects that investment also produces? For example, the fact that investment takes with it white migrants to South Africa results in a large number of them becoming active supporters of the apartheid State with relatives in Britain, who then perceive the South African conflict more and more on the basis that they have white relatives there placed on one side of the conflict. In addition, there is also the support which investment from overseas provides for the South African military and police forces both through taxation and through participation in the internal arms industry. Are these powerful supportive forces adequately compensated for by a marginal increase in black wages? The only real change that can come about in South Africa has to come about from within that country. Those who are outside have to decide basically which are the forces of change within South Africa with which they identify. This depends on the context in which one sees the conflict.
If one is preoccupied with peaceful change in a situation where the initiative has passed to the liberation movements engaged in active struggle, then it becomes essentially an anti-liberation movement posture. Hence, those committed to this view begin to play a role which is in direct confrontation with the African liberation struggle and helps to comfort the supporters of the Pretoria regime.
As for the churches in the West, they have to answer the question as to whether they wish to continue to be collaborators and accomplices in apartheid. The alternative is to disengage from the side of the white power system. By doing so, it might be easier to see the situation more objectively and adopt policies much more relevant to the rapidly changing situation in that region.
It may be necessary to mention once again that it is the oppressed people of South Africa and the leaders of their nationalist and liberation movements which have, over the years, asked for the withdrawal of investments. There is no doubt that the appeal for a boycott comes from those within the country who are the most active in fighting apartheid. It is, of course, true that there are African leaders, including certain Bantustan leaders having to operate within the apartheid structure, who have expressed themselves in opposition to some boycotts.
Southern Africa is undergoing tremendous changes and the central question facing the people in the Western countries is what policy they are to adopt in that growing conflict. It does appear to many of us that Christian opinion in the West is more often preoccupied with the whites in South Africa than with the aspirations of the oppressed black people. They seem to be looking for changes to emerge from within the white community and, when there are no radical changes that can be expected to come from that quarter, they appear to persist in their endless search. Inevitably, it seems as if Christians in the West were not seriously concerned about the plight of the African people. It is not very helpful, in a situation where after many years of effort at peaceful action armed struggle is finally resorted to because there is no alternative, for persons outside to suggest that one should instead be patient and work for peaceful change. What is often ignored is that there is a war in southern Africa in various stages and fought in different ways.
On the question of race and southern Africa, the West has a special responsibility because so far it has stood squarely on the side of white domination. If the confrontation in southern Africa erupts into a major war, there is a real danger of a global race conflict. South Africa is heavily armed and can create havoc in Africa. Western economic, political and military support for the Pretoria regime only gives it more confidence to persist in its aggressive posture towards neighbouring African countries and, at the same time, to refuse to abandon the policy of apartheid internally. Now, with its nuclear programme, South Africa presents the single greatest threat to world peace. It, therefore, becomes the responsibility of all those who are against racism and wish to preserve peace in Africa and the world that they should actively oppose the apartheid system and refuse to collaborate with it in any form.
Those who advocate reform through economic collaboration with apartheid are unable to explain how a marginal increase in black wages will bring about the transfer of political power to the majority population in South Africa - but that is the central problem. We reject totally the thesis which suggests that, by investing directly in our oppression, overseas investors will somehow be able to release us from the tyranny of apartheid.
(1) United Nations Centre against Apartheid, Notes and Documents No. 35/76, November 1976