IN THE Fourth Industrial Revolution race, there are leaders, and there are followers. For now, South Africa is the follower and China, in the form of technology companies like Huawei, is the leader.
What has been great about South Africa’s approach is the collaboration with leading tech companies like Huawei. It was, therefore, surprising to see the Ministry of Employment and Labour suing Huawei for violating employment equity conditions in South Africa.
Don’t get me wrong: tech companies should fulfil their employment equity responsibilities. This is even more important for foreign technology companies operating in South Africa. Here’s why:
When South Africa introduced the Black Economic Empowerment Act, big tech companies were expected to comply with the law, in the form of ownership share, skills development, and community upliftment and empowerment.
Big tech companies, who are predominantly foreign companies, refused to comply with the ownership part of the law. Doing so would have meant getting a local black empowerment partner. Big tech companies chose to comply with the law by implementing skills development and community development. How this was allowed would take a book to explain.
The important part of the story, for now, is that big tech foreign companies, not just Huawei, are getting away with murder as far as economic empowerment is concerned. This is the case because companies operating in other sectors are expected to comply with the economic empowerment laws designed to address inequalities in South Africa.
Given this reality, it is bizarre for the Employment and Labour Ministry to pursue Huawei for one part of the transgression. Why are big tech companies not expected to fulfil the ownership part of the empowerment act in South Africa?
Another significant point to consider in this debacle is that Huawei is not just any other tech company. Of all the foreign big tech companies, Huawei is one of the few that is an ally of the South African government. In the old dark days, IBM was an ally of the then government, and it was used to achieve some of its objectives. South Africa now has noble goals of advancing all in society.
The Chinese big tech company has everything that SA needs to achieve the goals. Huawei is not just a mobile device company. It has cloud capability that can be aligned to national needs through locating data centres locally. It has 5G and 6G capabilities that can enable South Africa to be a formidable force on the continent and the global stage.
Soon, Huawei will power autonomous vehicles with its tech, which can be instrumental in enabling South Africa to lead in the sector.
Huawei is one of the few big tech companies addressing tech skills challenges in South Africa, with 67 ICT academies in universities and colleges. If South Africa is to enable 5G connectivity, it is Huawei that will make it possible. As a member of the BRICS group, South Africa is better positioned to leverage its relationship with China to realise some of its technology dreams.
Huawei is the key entity from China that will make some of these things possible for South Africa. The position of the country is such that it needs a powerful and capable partner to realise some of its Four Industrial Revolution plans. Huawei, as a necessary ally, is not the company to attack.
If the South African government is serious about tackling big tech head-on, the ownership share issue should be the focus area for all other big tech companies.
As for employment equity issues, there’s quiet diplomacy for that and not the courts.
Minister Nxesi should consider all of these factors before pursuing something that can be resolved through dialogue.
South Africa cannot achieve its technology goals alone. It will need friends and partners in realising its dreams. Of course, some of the friends will act with selfish interest at times. When they do all that is a dialogue aimed at improving the relationship, and not a sledgehammer approach.
We are entering a very important phase in technological development across the world. South Africa, as a follower, needs a trusted leader to compete and, ultimately, also become a leader.
Wesley Diphoko is the Editor-In-Chief of the Fast Company (SA) magazine.
*The views expressed here are not necessarily those of IOL or of title sites.
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