South Africa's ANC may tighten black empowerment rules

Significance

AA forms a core part of Black Economic Empowerment (BEE) -- a policy designed to address the racial inequalities inherited from the apartheid era. It is politically popular, but critics allege BEE facilitates graft and is costly for business.

Impacts

• The main opposition Democratic Alliance's oscillation on whether it supports BEE will dissuade many black voters from supporting it.
• The opposition Economic Freedom Fighter's call for nationalisation of industry will resonate with unemployed black youths.
• The ANC will struggle to achieve its goal of creating '500 black industrialists' given the weak outlook for the economy.