Hewlett-Packard has become the first multinational to be exempted from selling 30% of its business in South Africa to black investors, the company said Aug. 27. Under an agreement reached with the government, the company will instead invest millions of dollars in a new business institute to provide training for 1,800 students over the next six years.
Through the institute, "the company will continue to contribute to our country's economic growth by creating new jobs skills and opportunities ... as well as addressing the skills shortage in critical areas."
Hewlett-Packard said the deal demonstrated the company's commitment to racial transformation of the business sector in South Africa. "HP has always embraced the principles of BEE (black economic empowerment) and is committed to the transformation in South Africa," said Thoko Mokgosi-Mwantembe, chief executive for HP South Africa.
A report in Business Day said that leading players in the IT sector such as HP, Microsoft and IBM had all raised objections with the government about the prospect of having to sell large parts of their local operations to black partners as part of BEE. The deal, which follows lengthy negotiations, was seen as a compromise that would allay the IT giants' fears and remain in line with the government goals of transforming the racial profile of the business sector in the post-apartheid era.
Copyright Agence France-Presse, 2007