Investment In South Africa Essay

1223 words - 5 pages

Caltex plant was established in South Africa in 1977 after the owners decided to expand its operations in South Africa. The construction of the plant brought controversy over the interested parties, there were two dimensions of the utilitarian benefits of the Caltex plant, and there were violations of the justice and of moral rights whereas on the other side there were possible benefits to the South Africans. The plant setup was helpful in that it provided job opportunities to majority of South African blacks, for their families and dependants. By 1976, American companies in south Africa had employed more than 60,000 people, this ensured that they had something to rely on for their survival, another benefit is that Caltex provided support to south Africa’s economy hence aided the government in stabilizing general price level and controlling inflation, this prevented the shooting of prices, thus local blacks could afford commodities cheaply.
It was an argument put by Caltex that it had made a progress in implementation of the code of conduct draft by Rev. Dr. Leon Sullivan which was comprised of six principles, (investor research 1986) thereby adding to their argument that there continued operations was focused on the plight of the blacks. Caltex ensured implementation of equal pay for equal work and benefits without any racial discrimination in South Africa; it had made a positive stride of 40%. The other benefit is that Caltex wages was above the minimum south African government wage level, thereby aiding in blacks welfare whose per capita in 1980 at 30% while in Johannesburg alone wages had gone up by 118%.
Though the construction of Caltex plant had many benefits as discussed, the investment turned to be a tragedy and serious violation of justice and morals for the blacks. First, under coercion and duress, the oil company supplied oil to the same government engines of the police wing and military. This department the enforced bad and lame laws used to oppress the South African blacks along colored classifications and racial lines. Due to segregation policies, frequent violations and retaliations especially in black townships was rampant, and because the government got material and economic support from such investors like Caltex, it was business as usual with no protection to civilians by the government, this made it more retrogressive and dangerous among the whites and blacks.
Caltex presence ensured apartheid is taken to new levels as the government consisted of only 18% blacks as whites controlled an over whelming 87% of the vast country’s land and more than 95% of the resources. Caltex expansion was not a priority and not all justified, it succeeded because transfer of technology was not guaranteed, freedom of movement was sabotaged, taxes increased, apartheid glorified and political power usurped. Given all the above benefits that would accrue to the blacks and the suffering they will incur, the social and moral violations outweigh...

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