South Africa: Revisiting Capital's ‘Formative Action’

This article revisits Saul and Gelb's 1981 analysis of South African capital's ‘formative action’, employing their framework to assess how capital hasshaped the economic framework since 1990. I show that once prominentbusiness leaders became committed to non‐racial democracy, the privatesector became enormously influential in shaping the economic programme.The policy changes permitted South African firms to restructure theiroperations largely on their own terms, becoming major investors elsewherein Africa and around the world. Despite their ostensible success, the neoliberal framework they cultivated may lack durability, simply because the ‘historical bloc’ underpinning it is so narrow that the programme has notoffered many benefits to the majority. Despite measures taken by thegovernment since 2000 to broaden the political coalition supporting the neoliberal restructuring, the recent crisis over presidential succession reflects the failure to vest the economic changes in a hegemonic programme.