Mandela’s Renunciation of Sanctions a Symbolic but Pivotal Event
NEW YORK (AP) _ American investors and business executives who’ve been sniffing quietly at South Africa’s borders are expected to grow bolder now that Nelson Mandela has renounced economic sanctions.
It’s unclear how much, or how soon, the flow of private U.S. money and commerce into South Africa will expand. But prominent U.S. political figures ranging from President Clinton to New York Mayor David Dinkins responded to Mandela’s proclamation by saying they’d expedite the end of the sanctions era.
Even before now, trade shows, investment seminars and government briefings on doing business in South Africa have been spreading, as it has become clearer that South Africa is moving to dismantle apartheid.
Mandela, president of the African National Congress and the most visible political figure symbolizing the change sweeping through South Africa, told the United Nations on Friday it was time to end the sanctions, which have isolated South Africa economically for many years.
″The countdown to democracy in South Africa has begun,″ he told the U.N. Special Committee Against Apartheid.
After Mandela spoke South African President F.W. de Klerk told The Associated Press: ″I am extremely happy that the issue of sanctions is no longer a bone of contention.″
Mandela and de Klerk have been urging U.S. corporations to examine opportunities in South Africa. Both have been reiterating that message in visits to the United States this past week.
″We have an economy that is tottering on the brink of an even deeper depression than the one we are experiencing now,″ Mandela said. De Klerk, meanwhile, was hosting a private lunch of business executives nearby.
Government officials and anti-apartheid activists had been anticipating Mandela’s renunciation of sanctions, calling it a symbolic but significant moment in South Africa’s evolution to government by the black majority.
″This puts American businesses and the civil rights movement and the churches and the anti-apartheid movement on the same side for once,″ said Daniel O’Flaherty, vice president of the National Foreign Trade Council.
Imposed as punishment for South Africa’s racial policies, the sanctions include voluntary restraints on investment and loans, supply of energy products and military cooperation.
They were enacted by the General Assembly, many countries and more than 160 American cities and states. The legislative process of rescinding them could take years.
Even without the sanctions, Mandela and DeKlerk face significant challenges to wooing foreign businesses to South Africa.
They must convince investors and traders that the violence in South Africa where hundreds have died recently should not be a deterrent. They must promote the advantages of South Africa’s infrastructure, considered the best in Africa.
″I would hope there there is a resurgence of investment interest,″ said Randall Robinson, executive director of TransAfrica, a prominent leader in the anti-apartheid movement. ″But I recognize that corporations make decisions at a relatively glacial pace.″
A number of high-profile U.S. companies that have vacated South Africa say they are in no rush to return. But a range of companies are interested in South Africa, especially in the telecommunications and data processing areas.
″My sense of it is their interest in South Africa is driven not so much by South Africa per se as it is by the competitive nature″ of their businesses, O’Flaherty said.
International Business Machines Corp. spokesman Mark Holcomb agreed, saying that while he couldn’t divulge IBM’s plans it is logical for companies ″to make a move sooner rather than later like you would in any developing market place″ bacause of competition.
Chrysler Corp. is undertaking a feasibility study for a South African presence but it has no timetable for completion, said spokesman Steven J. Harris.
Merrill Lynch, a leading Wall Street investment bank, said Friday it applauded the steps toward ending the sanctions. But the company, which has no presence in South Africa, said it wouldn’t change that policy until state and local jurisdictions rescinded sanctions.
At the same time, there are many promoters of trade and investment in South Africa.
″At first impression South Africa seems a troubled country and it no doubt is and it’s a rocky transition but it’s not the only troubled place that American businesses have invested in,″ said Herman Nickel, vice president of Global Business Access, hosting a trade show Oct. 1 that Mandela will address in Washington.
Henri W. Emmet, a consultant to the First National Bank of Southern Africa, said the bank last year asked 30 major U.S. corporations if they were interested in doing business in South Africa. More than half said yes.
Emmet said Mandela’s speech ″should get things going.″