The Effect of Sanctions on Constitutional Change in SA¶
Steward, Dave (on behalf of F.W. de Klerk) (2004). The Effect of Sanctions on Constitutional Change in SA. Speech to the Institut Choiseul, Paris, 14 June 2004; F.W. de Klerk Foundation. The FW de Klerk Foundation.
| Type | primary source |
| Scope | Economics and economic history of apartheid |
| Method | primary document |
| Period studied | 1945–1994 |
| Regions | South Africa, Namibia, Angola, Southern Africa |
| Themes | sanctions divestment, transition post apartheid, politics ideology elections, macro fiscal finance debt, inequality poverty unemployment, manufacturing industrial policy, demography urbanisation, bantustans removals influx |
| Citation key | steward2004a |
Argument¶
Speaking for de Klerk, Steward argues that sanctions were not the principal cause of the National Party's 1990 decision to embark on fundamental reform. He holds that sanctions harmed and distorted the economy but also produced unintended effects, such as strengthening NP electoral support and spurring import-substituting industries (Sasol, armaments). The 1985-86 banking crisis, he says, came from a market collapse of confidence rather than from government-imposed sanctions. He attributes the change to the failure of the homelands/partition policy, the end of communism, the 1988 Namibia/Angola/Cuba settlement, and above all to long-run economic and social change (urbanisation, rising black incomes and education, Afrikaner embourgeoisement). The lesson drawn is that sanctions are a blunt instrument that work only when they do not threaten a target's core interests.
Evidence and method¶
No footnotes or systematic data. It relies on assertion and recollection, a few cited statistics (a McGrath study of income shares, Small Business Development Corporation figures, 1993 university enrolments, a 1986 white opinion survey, unspecified opinion surveys of black attitudes to sanctions), and the author's own political experience.
Place in the debates¶
- Sanctions effectiveness: did external pressure cause the 1990 transition? (see Why apartheid ended: reform, transition and elite bargaining). Sceptical. Sanctions were a factor to be weighed but 'not by any means the main factor'. Internal economic and social change, the failure of partition and the end of the Cold War mattered more. This is the position of an interested former regime insider.
- Liberal vs revisionist on apartheid, growth and economic change (see Liberal vs revisionist: was apartheid functional or dysfunctional for capitalist growth?). Broadly liberal. Market-driven urbanisation and growth eroded apartheid ('changing economic relationships have led to changed social relationships'), and sanctions slowed these forces.
- Economic costs of sanctions (see Sanctions, disinvestment and the anti-apartheid movement). Sanctions cut growth by about 1.5% a year and forced costly strategic investments, but also spurred import substitution. The 1985 debt crisis was market-driven rather than a sanction.
Findings¶
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The speaker estimates sanctions' growth cost at about 1.5 percentage points per year, while stating South Africa could still obtain essentials, including oil, at a premium. (p. 4)
sanctions seriously harmed and distorted the South African economy – and probably reduced its economic growth rate by about 1.5% per annum.
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The 1970 OPEC oil embargo spurred Sasol's expansion and a petrochemical industry. Oil stockpiled cheaply in the 1960s was sold at a profit in the 1980s. (p. 3)
OPEC’s 1970 oil sanctions spurred South Africa to expand and develop SASOL, its advanced oil from coal process, which soon provided a significant part of its fuel requirements
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The 1963 arms embargo forced the creation of a domestic armaments industry that became a significant exporter. (p. 3)
forced South Africa to develop its own armaments industry which by the ‘eighties had become the sixth or seventh largest in the world.
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The Delta Motors case is cited to show that disinvestment could transfer assets to white managers at bargain prices and free them from the Sullivan code. (p. 3)
the only way that it could extricate itself was by lending the white South African management of the company sufficient funds to buy out the company at a bargain price.
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The 1985-86 banking crisis, when banks refused to roll over short-term loans, is characterised as market-driven rather than government-imposed. (p. 6)
refused to roll over about $ 14 billion of short-term loans.
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The economy grew despite tightening sanctions, which supports the claim that the regime could have held on for years. (p. 6)
the economy actually grew at an annual rate of 2.7% between April 1986 and February 1989.
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The homeland partition model is described as having failed by the early 1980s. The 78% black majority was allocated 13% of the land, and urban economies were integrating. (p. 7)
with the 78% black majority being allocated only 13 % of the land
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The black share of personal income was static from 1917 to 1970 and then rose sharply, with the white share falling below half by 1991 (citing McGrath). (p. 8)
In 1917 Black share of personal income was 20,3%. By 1970 it had, according to him, actually declined slightly to only 19,8% compared with a White share of 71,1%.
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The author claims informal urbanisation made the pass laws and Group Areas Act redundant before their formal repeal. (p. 8)
the “pass laws” were abolished by the reality of millions of people migrating to the cities, long before 1986 when they were officially scrapped
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The speech concludes that sanctions work only when they do not threaten the core interests of the target, and that sanctions on growth slowed the underlying forces for change. (p. 10)
sanctions can be quite effective in encouraging action and reforms that do not threaten the core interests or the continued existence of targeted governments
Evidence ledger¶
Sources used¶
| Source | Kind | Period | How used |
|---|---|---|---|
| M D McGrath study of racial distribution of personal income, 1917-1970 | secondary literature compilation | 1917-1970 (extended to 1991 in text) | Establishes that the black share of personal income barely changed 1917-1970 and then rose to 37% by 1991, supporting the claim of underlying economic change. |
| Small Business Development Corporation figures on black small businesses | official statistical series | early 1990s | Cited to show more than 625,000 small black businesses by the early 1990s as evidence of black economic advance. |
| University, technikon and teacher-training enrolment figures, 1993 (source unnamed) | official statistical series | 1993 | Shows black undergraduate enrolment exceeding white enrolment by 1993 as evidence of social change. |
| Opinion surveys of black South African attitudes to sanctions (unnamed) | author survey or fieldwork | 1980s (unspecified) | Asserts that a sizable majority of black South Africans opposed sanctions. |
| 1986 survey of white South African opinion on sanctions and negotiations (unnamed) | author survey or fieldwork | 1986 | Used to show whites opposed concessions under sanctions and only 30% would contemplate negotiating with the ANC. |
| March 1992 whites-only referendum result | election returns | March 1992 | Cited briefly as evidence that a newly middle-class Afrikaner generation supported continued reform. |
| UN Security Council Resolutions 432 and 435 and the Secretary-General's implementation plan | commission or official report | 1976-1978 | Used to narrate the Namibia negotiations and why South Africa lost confidence in the UN process. |
| Tripartite agreement between South Africa, Cuba and Angola, 1988 | legislation gazette | 1988-1989 | Presented as a factor reassuring the government that it could secure core interests through negotiation. |
| Macro figures on growth and sanctions costs (unattributed): 2.7% growth April 1986-Feb 1989; 1.5% p.a. growth loss; R13 billion Mossel Bay investment; $14 billion loans not rolled over | national accounts macro | 1986-1989 | Used to argue that sanctions harmed the economy but the economy still grew and the government could have held on. |
Inference¶
Quantification: Illustrative figures.
Speech by a former government's representative; argument rests on narrative reconstruction, counterfactual assertion and selective illustrative statistics, claiming that long-run socio-economic change and the Cold War's end, not sanctions, drove the 1990 reforms. No formal test of causality.
Key claims¶
| Claim | Basis | Strength |
|---|---|---|
| Sanctions were not the main factor in the decision to reform; underlying economic and social change, the end of communism, the failure of homeland policy and the Namibia settlement were more important. (p. 10) | Narrative argument and insider assertion; no systematic evidence tying causes to the decision. | Asserted |
| Sanctions reduced South African economic growth by roughly 1.5% a year. (p. 4) | Unsourced estimate; no model or data cited. | Asserted |
| Sanctions had unintended consequences: SASOL expansion, a domestic arms industry, oil stockpiling and profitable management buyouts after disinvestment. (p. 3) | Anecdotal examples such as SASOL, Armscor-type industry and General Motors/Delta Motors; no figures or sources given. | Illustrative or anecdotal |
| The black share of personal income was stagnant 1917-1970 but rose sharply (to 37%) by 1991 while the white share fell below 50%. (p. 8) | McGrath's study cited second-hand. | Partial data |
| The 1985-86 banking crisis (refusal of banks to roll over about $14 billion) was caused by market confidence collapse rather than government-imposed sanctions. (p. 6) | Assertion with no loan or bank data cited. | Asserted |
| The economy stabilised by 1988 and the government could have maintained control for another ten to twenty years. (p. 6) | Growth rate figure plus the speaker's judgement; counterfactual. | Asserted |
| Black South Africans increasingly dominated consumer markets and education, which made pass laws and the Group Areas Act unenforceable in practice. (p. 8) | SBDC small-business count and university enrolment figures plus general assertions about consumer goods purchases. | Illustrative or anecdotal |
| Frontline states lobbying for sanctions did not apply them, and those with least trade links were most fervent supporters. (p. 4) | General assertion about open borders and rail/port use; no trade data cited. | Asserted |
The author's caveats¶
None; the speech presents figures without acknowledging limitations.
Gaps in the evidence¶
The argument needs counterfactual or time-series evidence linking sanctions, capital flows and financial pressure to government decisions, such as Reserve Bank and loan data, trade statistics, and cabinet or National Party records. Estimates of the growth cost of sanctions require a modelled or documented basis. Survey data on black and white attitudes, and income-distribution sources, should be named and verifiable. Many of these sources (Reserve Bank series, national accounts, Hansard, archival cabinet papers, later published surveys) existed or are now accessible.
Replicability: Data poorly documented.