So Long, Sanctions, Hello, Democracy? : California and Los Angeles need to heed Mandela

The moment has finally arrived. Nelson Mandela has called for removal of the punitive economic sanctions that encouraged his nation’s white minority to dismantle apartheid and embrace equality for the black majority. It is time for the world to return to South Africa.

In response to the African National Congress leader’s moving speech Friday to the United Nations, the Clinton Administration immediately encouraged all state and municipal governments to lift the local trade and investment restrictions against businesses with ties to South Africa. Washington’s counsel is important on this score because more than 100 states and cities, California and Los Angeles among them, have prohibited commerce with firms that do business with South Africa.

FIRST IN: California took the lead in the state and university divestment movement, adopting a state divestment policy in 1986. That law forced the massive state pension funds for public employees, teachers and the University of California to pull out $7.2 billion from businesses that had employees, owned plants, held subsidiaries or engaged in any form of trade in South Africa. The California action encouraged other state and municipal governments to protest similarly.

Among municipalities, Berkeley took the lead in 1979 by refusing to bank with financial institutions that extended credit to South Africa. That anti-apartheid policy was later toughened to prohibit government business with any firm even marginally connected to South Africa. The Los Angeles City Council adopted similar restrictions in 1986.

The combination of local, state and federal measures dramatically increased the impact of the economic boycott of South Africa. Shortly after Chase Manhattan Bank and many other U.S. financial institutions pulled out, Congress approved tough economic sanctions over Ronald Reagan’s presidential veto in 1986. The flight of U.S. companies and the end of lending by the World Bank and the International Monetary Fund proved particularly crippling to South Africa. Most federal restrictions were lifted by President George Bush in 1991 but not before major damage had been done.

NOT THE LAST OUT: The economic isolation helped force the white minority to agree to share power with the huge black majority. On Thursday, Parliament approved a multiracial executive council to oversee the transition to multiracial government before the first truly open election, to be held next April.

South Africa has paid a high price for its apartheid policy. The new government will inherit a troubled economy, an unemployment rate of nearly 50% and a huge gap in services provided to whites and blacks. To bridge that chasm, the nation will need massive new foreign investment that stimulates a vigorous economic recovery and creates jobs. To improve the inferior housing, schools and hospitals imposed on blacks, South Africa will also need substantial foreign assistance from governments and philanthropies.

President Clinton is sending his commerce secretary, Ronald H. Brown, on a trade mission to South Africa to encourage American investment. The heads of state and local governments, universities, pension funds and unions also should heed Nelson Mandela’s call to return to a changing South Africa. California and Los Angeles should act quickly and not drag their feet.