Namibia: Corporate Investment in Oppression

To discuss minor improvements in social conditions and the lack of positive harm being done obscures these companies' support for white minority rule.

NAMIBIA, a de facto province of South Africa, is similar to South Africa in the extreme inequality they both enforce between blacks and whites. Questions of international investment in the occupied territory, however, assume a different character from issues of investment in South Africa because of charges that South Africa's control over Namibia is illegal.

Harvard's newly-formed Advisory Committee on Shareholder Responsibility (ACSR) decided two weeks ago to endorse a shareholder resolution calling for the withdrawal of Phillips Petroleum from Namibia. Several ACSR members stated that the official illegality of South Africa's rule was the crucial factor in their decision.

The Harvard Corporation followed the ACSR's lead and also voted against Phillip's management.

In the final tally of Phillips shareholders, 91 per cent voted with management, 4.5 per cent endorsed the resolution and 4.5 per cent abstained. Despite appearances, 4.5 represents a substantial percentage for proxy resolutions, given that management usually owns the majority of stock. (98 per cent of the votes supported Gulf management in last year's Angola disclosure resolution, for example.) These figures are telling evidence that restrictions on legal grounds may carry more weight than any appeal to moral obligations.

SOUTH AFRICA acquired control of Namibia in 1919, under a mandate of the League of Nations, with the condition that the government promote the well-being and social progress of the inhabitants. But in 1964, the United Nations, successor to the League of Nations, charged that South Africa failed to carry out this condition and deprived inhabitants of basic human rights and freedoms.


The U.N. terminated South Africa's mandate in 1966, and in 1970 the Security Council requested all member nations to refrain from any relationship with South Africa which implied recognition of its control over Namibia.

The Security Council also requested that the International Court of Justice rule on South Africa's mandate. The Court advised that U.N. members had the following duties: 1) to recognize the "illegality of South Africa's presence in Namibia." 2) to recognize the "invalidity of its acts on behalf of or concerning Namibia," and 3) "to refrain from any acts and in particular any dealings with the Government of South Africa a) implying recognition of the legality of, or b) lending support or assistance to, such presence and administration."

In May 1970, former U.N. ambassador Charles Yost announced that the U.S. would officially discourage investment by American business in Namibia, would cut off Export-Import Bank guarantees and would not protect investments made since 1966. But none of the measures the U.S. government has taken to prevent investment have been effective. Many corporations--including Phillips Petroleum, Continental Oil, U.S. Steel and Bethlehem Steel--have decided to invest despite official policy.

Whether the U.S. would maintain sanctions under pressure from business in uncertain. Evidence to the contrary lies in the fact that the United States ended support for U.N.-imposed sanctions on importation of chrome from Rhodesia. This action, which the U.S. called a "strategic necessity," was a result of massive lobbying by the chrome companies.

Namibia sticks out as a clear-cut case of how weak the U.N. is left when its more powerful members do not throw their weight behind U.N. decisions. France and England would not support Namibia and endanger important trade ties with South Africa. The USSR and the U.S. would not acquire any political or economic benefits from a Namibian confrontation. An effort for Namibia would amount to a "moral expedition," said an observer who was quoted in The Wall Street Journal.

Although South Africa is a member of the U.N., it does not recognize U.N., authority as the successor to the League of Nations. In defiance of the U.N., South Africa passed two laws extending formal apartheid measures to Namibians. The Development of Self-Government for Native Nations in South-West Africa Act of 1968 divided the worst desert lands into tribal areas called Bantustans, which were to be kept under close South African control. Then, in 1969, the South-West African Affairs Act brought Namibia completely under South African administration by making it a fifth province.

NAMIBIA lies directly to the northwest of South Africa on the Atlantic coast. Though the country is the size of France and Britain combined, the Kalahari and Namib deserts cover most of the land. Of a population estimated between 610,000 and 750,000, 88 per cent is black or coloured and the remaining 12 per cent, white.

The white sector in Namibia currently depends on Africans for cheap labor. Fifty-five to sixty per cent of the blacks are forced to live in the arid Bantustans of the northern frontier--which are too barren to support the population--while a tax on the Africans drives the men to work in the white "police zone." Black Africans are forbidden by law to fill skilled jobs.

Until last year, the only way to leave the reserve was through a contract with the South-West African Labor Association (SWANLA). SWANLA classified each man according to physical fitness for a) mines and industries, b) agriculture and c) livestock breeding. Men were then shipped, on order, to workers' compounds hundreds of miles from the reserves where their families were forced to remain.

Labor contracts ranged from 12 to 30 months. It was a criminal offense to break a contract, to leave designated compounds, organize unions, or strike. Prior to 1966, the South African government informed the World Court that minimum wages were from $8.50 to $15.40 a month.