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Disinvestment from South Africa Wiki2Web Clarity Challenge

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Study Guide: The Anti-Apartheid Disinvestment Campaign: A Historical Analysis

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The Anti-Apartheid Disinvestment Campaign: A Historical Analysis Study Guide

Early Advocacy and International Frameworks (1950s-1960s)

Advocacy for disinvestment from South Africa commenced in the 1960s as a protest against the apartheid system.

Answer: True

Explanation: The movement to advocate for disinvestment from South Africa began in the 1960s as a direct response to the apartheid system.

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Significant implementation of disinvestment policies against South Africa began in the 1960s.

Answer: False

Explanation: While advocacy began in the 1960s, significant implementation of disinvestment policies did not commence until the mid-1980s.

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UN General Assembly Resolution 1761, passed in November 1962, called for economic sanctions against South Africa and established the Special Committee against Apartheid.

Answer: True

Explanation: United Nations General Assembly Resolution 1761, adopted in November 1962, formally requested member states to impose economic sanctions on South Africa and established the United Nations Special Committee against Apartheid.

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Western nations and South Africa's major trading partners fully supported UN Resolution 1761 and actively participated in the Special Committee against Apartheid.

Answer: False

Explanation: Major Western nations and South Africa's principal trading partners opposed the call for sanctions and subsequently boycotted the United Nations Special Committee against Apartheid.

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The 1964 International Conference for Economic Sanctions Against South Africa concluded that sanctions were illegal and impracticable.

Answer: False

Explanation: The conference concluded that internationally organized sanctions against South Africa were deemed necessary, legal, and practicable, recognizing apartheid policies as a threat to global peace.

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Britain collaborated with the U.S. at the UN in 1964 to focus on implementing comprehensive economic sanctions against South Africa.

Answer: False

Explanation: The United Kingdom, in collaboration with the United States, consistently declined to recognize that the situation in South Africa fell under Chapter VII of the UN Charter and focused on less stringent measures, indicating a prioritization of economic interests over comprehensive sanctions.

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The voluntary UN arms embargo against South Africa was made mandatory in 1977 through Security Council Resolution 418.

Answer: True

Explanation: The voluntary United Nations arms embargo was rendered mandatory through the adoption of UN Security Council Resolution 418 in 1977.

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When did the advocacy for disinvestment from South Africa commence, and when did it achieve significant implementation?

Answer: Advocacy began in the 1960s, with significant implementation in the mid-1980s.

Explanation: Advocacy for disinvestment from South Africa commenced in the 1960s as a protest against the apartheid system. However, significant implementation of these policies did not occur until the mid-1980s.

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What was the primary significance of UN General Assembly Resolution 1761 passed in November 1962?

Answer: It mandated comprehensive economic sanctions against South Africa and established the Special Committee against Apartheid.

Explanation: United Nations General Assembly Resolution 1761 established the United Nations Special Committee against Apartheid and formally called for economic and other sanctions against South Africa.

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How did major Western nations and trading partners react to UN Resolution 1761?

Answer: They opposed the call for sanctions and boycotted the Special Committee against Apartheid.

Explanation: Major Western nations and South Africa's principal trading partners opposed the call for sanctions and subsequently boycotted the United Nations Special Committee against Apartheid.

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According to the 1964 International Conference for Economic Sanctions Against South Africa, what was the conclusion regarding the effectiveness of sanctions?

Answer: Sanctions were considered necessary, legal, and practicable, but required British and U.S. participation to be effective.

Explanation: The conference concluded that internationally organized sanctions against South Africa were deemed necessary, legal, and practicable, recognizing apartheid policies as a threat to global peace. It further emphasized that the active participation of the United Kingdom and the United States was essential for the effectiveness of sanctions.

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Corporate Engagement and Activism

The Sullivan Principles, introduced in 1977, required corporations to ensure equal treatment for all employees regardless of race in South Africa.

Answer: True

Explanation: The Sullivan Principles, authored by Rev. Dr. Leon Sullivan, mandated that corporations operating in South Africa ensure equal treatment for all employees irrespective of race and foster an integrated work environment.

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Activists lobbied institutional investors to divest from U.S. companies that had adopted the Sullivan Principles.

Answer: False

Explanation: Activists lobbied institutional investors to end their involvement with or investments in South Africa, particularly from companies not adhering to the Sullivan Principles, rather than divesting from those that adopted them.

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Shareholder resolutions were one method used by activists to pressure public companies with South African interests.

Answer: True

Explanation: Shareholder resolutions constituted a significant method employed by activists to exert pressure on public companies that had interests in South Africa.

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What was the purpose of the Sullivan Principles, introduced in 1977?

Answer: To require corporations doing business in South Africa to ensure equal treatment for all employees regardless of race.

Explanation: The Sullivan Principles mandated that corporations operating in South Africa ensure equal treatment for all employees irrespective of race and foster an integrated work environment, thereby directly challenging apartheid's segregationist policies.

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Who authored the Sullivan Principles, and what was his background?

Answer: Rev. Dr. Leon Sullivan, an African-American preacher and General Motors board member.

Explanation: Leon Sullivan was an African-American clergyman from Philadelphia and a member of the General Motors board of directors. He authored and lent his name to the Sullivan Principles, initiatives designed to promote equal treatment and integration for employees within South Africa.

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How did anti-apartheid activists in the U.S. pressure institutional investors regarding South African interests?

Answer: By lobbying them to end involvement with or investments in South Africa, especially from companies not adhering to the Sullivan Principles.

Explanation: Activists actively lobbied institutional investors to cease their involvement with or investments in South Africa, framing it as a matter of corporate social responsibility. They also advocated for the divestment from United States companies with South African interests that had not adopted the Sullivan Principles.

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Higher Education and Grassroots Movements

Black South African resistance to the 1983 South African constitution was a catalyst for the disinvestment campaign gaining critical mass in the U.S. in 1984.

Answer: True

Explanation: The campaign achieved critical mass following the resistance by Black South Africans to the 1983 South African constitution, an act that further entrenched racial segregation and discrimination.

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Student activists demanded that their universities invest more heavily in companies trading with South Africa.

Answer: False

Explanation: Student activists demanded that their institutions divest from companies trading or operating in South Africa, rather than invest more heavily.

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Ramon Sevilla founded the first anti-apartheid organization on U.S. university campuses at UCLA.

Answer: False

Explanation: Ramon Sevilla founded the first anti-apartheid organization on U.S. university campuses at UCLA, not at UCLA specifically, but he was associated with activism there.

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Hampshire College was the first institution to completely divest from companies with major South African interests in 1977.

Answer: True

Explanation: Hampshire College holds the distinction of being the first institution to completely divest from companies with significant South African interests in 1977.

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Between 1984 and 1988, the number of educational institutions divesting from South Africa decreased significantly.

Answer: False

Explanation: The number of institutions divesting increased progressively from 53 in 1984, to 128 in 1987, and subsequently to 155 in 1988.

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The disinvestment campaign at Michigan State University began in 1977.

Answer: True

Explanation: The campus-based disinvestment campaign commenced in 1977 at Michigan State University and Stanford University.

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The initial Columbia University divestment campaign focused on companies involved in South Africa's military operations.

Answer: False

Explanation: The initial campaign at Columbia University focused on bonds and financial institutions directly engaged with the South African regime, not specifically military operations.

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Students at Smith College protested by blockading administrative offices after the trustees decided not to fully divest.

Answer: False

Explanation: Students at Smith College staged a sit-in in administrative offices and blockaded the building the following day, preventing staff access, after the trustees decided not to fully divest.

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Smith College had divested all its stocks in companies working in South Africa by October 31, 1988, valued at $39 million.

Answer: True

Explanation: By October 31, 1988, Smith College had completed the divestment of all stocks valued at $39 million held in companies operating within South Africa.

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Harvard University argued that purging stocks from its portfolio was the most effective way to fight apartheid.

Answer: False

Explanation: Harvard University maintained that its proxy voting mechanisms offered a more effective means of combating apartheid than the simple divestment of stocks from its portfolio.

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The University of California withdrew $3 billion worth of investments from South Africa in 1986, a move Nelson Mandela found insignificant.

Answer: False

Explanation: In 1986, the University of California authorized the withdrawal of three billion dollars in investments from South Africa. Nelson Mandela noted that this substantial divestment was particularly significant in applying pressure for the termination of white-minority rule.

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Gettysburg College divested $5.4 million from companies connected to South Africa in 1989 following a Board of Trustees review.

Answer: True

Explanation: Gettysburg College divested $5.4 million from companies with ties to South Africa following a comprehensive three-year review by its Board of Trustees and a five-month campus advocacy campaign.

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'Selective purchasing policies' involved cities prioritizing companies that *did* conduct business in South Africa for contracts.

Answer: False

Explanation: These policies entailed cities prioritizing companies that abstained from conducting business in South Africa when awarding contracts for goods and services.

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The image caption mentions P.W. Botha as the South African president featured in a Vassar College student newspaper article about disinvestment.

Answer: True

Explanation: The image caption notes that the campaign to divest from South Africa gained prominence on United States university campuses during the mid-1980s, with the issue prominently featured on the front page of Vassar College's student newspaper in October 1985. It further identifies the individual depicted as the then-President of South Africa, P.W. Botha.

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What event in 1984 is cited as a catalyst for the U.S. disinvestment campaign gaining critical mass?

Answer: Black South African resistance to the 1983 South African constitution.

Explanation: The campaign achieved critical mass following the resistance by Black South Africans to the 1983 South African constitution, an act that further entrenched racial segregation and discrimination.

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What was the role of student activists in the higher education divestment campaigns?

Answer: They demanded that their institutions divest from companies trading or operating in South Africa.

Explanation: Student activists issued demands for their colleges and universities to divest from companies trading or operating in South Africa, thereby pressuring boards of trustees to enact policy changes.

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Which U.S. institution was the first to completely divest from companies with major South African interests in 1977?

Answer: Hampshire College

Explanation: Hampshire College holds the distinction of being the first institution to completely divest from companies with significant South African interests in 1977.

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How did the number of educational institutions divesting from South Africa change between 1984 and 1988?

Answer: It increased from 53 in 1984 to 155 in 1988.

Explanation: The number of institutions divesting increased progressively from 53 in 1984, to 128 in 1987, and subsequently to 155 in 1988.

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What was the initial focus of the Columbia University divestment campaign?

Answer: Bonds and financial institutions directly involved with the South African regime.

Explanation: The initial campaign at Columbia University focused on bonds and financial institutions directly engaged with the South African regime.

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How did students at Smith College protest the Board of Trustees' decision not to fully divest in 1986?

Answer: They staged a sit-in in administrative offices and blockaded the building the next day.

Explanation: Students protested by occupying administrative offices in a sit-in and subsequently blockading the building the following day, thereby preventing staff access.

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What significant action did the University of California take regarding divestment in 1986?

Answer: It authorized the withdrawal of three billion dollars worth of investments from South Africa.

Explanation: In 1986, the University of California authorized the withdrawal of three billion dollars in investments from South Africa.

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What were 'selective purchasing policies' used by cities in the context of the disinvestment campaign?

Answer: Policies that gave preference in contracts to companies that did not do business with South Africa.

Explanation: These policies entailed cities prioritizing companies that abstained from conducting business in South Africa when awarding contracts for goods and services.

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Legislative and Governmental Sanctions

The British government refused to implement economic sanctions because they believed the situation in South Africa threatened international peace.

Answer: False

Explanation: The British government asserted that imposing sanctions would be unconstitutional, citing their belief that the situation in South Africa did not constitute a threat to international peace and security. Furthermore, they doubted that sanctions would effectively persuade the South African government to alter its policies.

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The Labour Party's victory in the 1964 UK general election led to the immediate imposition of trade sanctions against South Africa.

Answer: False

Explanation: Despite the Labour Party's victory in 1964, their commitment to imposing trade sanctions against South Africa waned, and no immediate imposition occurred.

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The Michigan Legislature's 1982 vote for divestiture by public colleges was upheld as constitutional.

Answer: False

Explanation: Although the Michigan Legislature voted in 1982 for divestiture by public colleges and universities, this legislative action was later invalidated as unconstitutional.

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By the end of 1989, only a few U.S. cities had taken economic action against companies doing business in South Africa.

Answer: False

Explanation: By the conclusion of 1989, a total of 26 states, 22 counties, and over 90 cities had implemented some form of binding economic action targeting companies engaged in business with South Africa.

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Nebraska was the last U.S. state to divest from South Africa, initiated by its sole Black legislator.

Answer: False

Explanation: While Nebraska was the first U.S. state to divest, it was not the last. The initiative was indeed spearheaded by Ernie Chambers, the sole Black member of the Nebraska legislature.

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Ernie Chambers introduced a divestment resolution in Nebraska after learning the University of Nebraska had accepted a donation of Krugerrands.

Answer: True

Explanation: Chambers expressed significant displeasure upon discovering that the University of Nebraska–Lincoln had accepted a donation of Krugerrands, which are South African gold coins, prompting him to introduce a divestment resolution.

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Nebraska's nonbinding divestment resolution became state law in 1980, immediately causing significant changes in business practices.

Answer: False

Explanation: The nonbinding resolution was enacted into state law in 1980. Initially, it resulted in minimal immediate alteration of business practices.

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Nebraska passed stronger, mandatory divestment legislation in 1984.

Answer: True

Explanation: Nebraska enacted more stringent legislation in 1984, mandating the divestment of all funds from companies engaged in business with South Africa.

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The Comprehensive Anti-Apartheid Act of 1986 was introduced by Senator Ted Kennedy.

Answer: False

Explanation: The Comprehensive Anti-Apartheid Act of 1986 was introduced by Congressman Ronald Dellums, not Senator Ted Kennedy.

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President Ronald Reagan successfully vetoed the Comprehensive Anti-Apartheid Act of 1986, preventing it from becoming law.

Answer: False

Explanation: President Reagan vetoed the Act; however, the Republican-controlled Senate subsequently overrode his veto, demonstrating the considerable strength of the anti-apartheid movement.

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The Comprehensive Anti-Apartheid Act of 1986 banned all U.S. trade with South Africa, including strategic minerals.

Answer: False

Explanation: The Act imposed a ban on new United States investment in South Africa, prohibited sales to its police and military forces, and restricted new bank loans. It also forbade the import of specific goods but did not ban all U.S. trade.

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According to Richard Knight, the Comprehensive Anti-Apartheid Act of 1986 led to a sustained decline in U.S. imports from South Africa.

Answer: False

Explanation: Richard Knight noted that while U.S. imports from South Africa declined initially, they later increased, attributing some of this rise to lax enforcement and observing that the Act had minimal effect in prohibiting exports to South Africa.

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Representative Charles Rangel's amendment in 1987 subjected U.S. corporations operating in South Africa to double taxation on their profits.

Answer: True

Explanation: The amendment introduced by Representative Charles Rangel eliminated the capacity for United States corporations to receive tax reimbursements for taxes paid in South Africa, thereby subjecting them to double taxation.

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The Rangel amendment significantly decreased the tax burden on U.S. companies operating in South Africa.

Answer: False

Explanation: The Rangel amendment escalated the tax burden for United States companies operating in South Africa, increasing it from 57.5% to 72% of their profits.

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A harsher sanctions bill passed by the House in 1988 mandated the sale of all South African investments by U.S. residents but was signed into law.

Answer: False

Explanation: This bill, which mandated the withdrawal of all U.S. companies from South Africa and the divestment of all South African investments by U.S. residents, did not achieve enactment into law as it failed to pass the Senate.

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Why did the British government refuse to implement economic sanctions against South Africa following the 1964 conference?

Answer: They argued sanctions were unconstitutional, did not see the situation as a threat to peace, and doubted their persuasive power.

Explanation: The British government asserted that imposing sanctions would be unconstitutional, citing their belief that the situation in South Africa did not constitute a threat to international peace and security. Furthermore, they doubted that sanctions would effectively persuade the South African government to alter its policies.

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Which U.S. state was the first to divest from South Africa, and who initiated the effort?

Answer: Nebraska, initiated by Ernie Chambers.

Explanation: Nebraska holds the distinction of being the first U.S. state to divest from South Africa, with the initiative spearheaded by Ernie Chambers, who was the sole Black member of the Nebraska legislature.

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What prompted Ernie Chambers to introduce a divestment resolution in Nebraska?

Answer: A donation of South African gold coins (Krugerrands) to the University of Nebraska.

Explanation: Chambers expressed significant displeasure upon discovering that the University of Nebraska–Lincoln had accepted a donation of Krugerrands, which are South African gold coins, prompting him to introduce a divestment resolution.

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What was the name of the federal act passed in 1986 that imposed sanctions on South Africa, and who introduced it?

Answer: The Comprehensive Anti-Apartheid Act of 1986, introduced by Congressman Ronald Dellums.

Explanation: The Comprehensive Anti-Apartheid Act of 1986 was introduced by Congressman Ronald Dellums.

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How did President Ronald Reagan's veto of the Comprehensive Anti-Apartheid Act of 1986 play out?

Answer: The veto was overridden by Congress, making the act law.

Explanation: President Reagan vetoed the Act; however, the Republican-controlled Senate subsequently overrode his veto, demonstrating the considerable strength of the anti-apartheid movement.

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What specific trade measures were included in the Comprehensive Anti-Apartheid Act of 1986?

Answer: A ban on new U.S. investment, sales to police/military, and import of specific goods like agricultural products and textiles.

Explanation: The Act imposed a ban on new United States investment in South Africa, prohibited sales to its police and military forces, and restricted new bank loans. It also forbade the import of agricultural goods, textiles, shellfish, steel, iron, uranium, and products originating from state-owned corporations.

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By the end of 1989, approximately how many U.S. cities had taken binding economic action against companies doing business in South Africa?

Answer: Over 90

Explanation: By the conclusion of 1989, a total of 26 states, 22 counties, and over 90 cities had implemented some form of binding economic action targeting companies engaged in business with South Africa.

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Economic Impacts and Financial Strategies

The disinvestment campaign began to significantly impact South Africa's economy primarily due to internal political reforms in 1984.

Answer: False

Explanation: The disinvestment campaign began to exert a significant impact on South Africa's economy subsequent to the involvement of major Western nations, including the United States, commencing in mid-1984, which led to considerable capital flight.

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Net capital movements out of South Africa increased consistently every year from 1985 to 1988.

Answer: False

Explanation: The net capital movements out of South Africa were R9.2 billion in 1985, R6.1 billion in 1986, R3.1 billion in 1987, and R5.5 billion in 1988, indicating fluctuations rather than consistent annual increases.

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Capital flight caused the South African rand to appreciate significantly against international currencies.

Answer: False

Explanation: Capital flight precipitated a dramatic depreciation in the international exchange rate of the South African rand.

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The South African government imposed exchange controls in September 1985 to encourage capital outflow.

Answer: False

Explanation: The South African government instituted exchange controls in September 1985 specifically to restrict capital outflow, not encourage it.

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The financial rand system meant that companies withdrawing investments received more dollars for their capital.

Answer: False

Explanation: The financial rand traded at a discount ranging from 20% to 40% relative to the commercial rand, signifying that companies undertaking disinvestment received substantially fewer dollars for the capital they repatriated.

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Exchange control stamps in mid-1980s South African passports indicated the amount of currency a holder could take *into* the country.

Answer: False

Explanation: The exchange control stamps found in South African passports from the mid-1980s signified the permissible amount of currency a passport holder could export from the country, not import.

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What was the economic impact of capital flight on the South African rand?

Answer: It triggered a dramatic decline in the international exchange rate of the rand.

Explanation: Capital flight precipitated a dramatic depreciation in the international exchange rate of the South African rand. This currency devaluation rendered imports more costly, consequently driving inflation to rise steeply.

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How did the financial rand system affect companies withdrawing investments from South Africa?

Answer: It meant they received significantly fewer dollars for their capital due to a discount.

Explanation: The financial rand traded at a discount ranging from 20% to 40% relative to the commercial rand, signifying that companies undertaking disinvestment received substantially fewer dollars for the capital they repatriated.

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What was the primary cause cited for the disinvestment campaign beginning to significantly impact South Africa's economy in the mid-1980s?

Answer: The involvement of major Western nations in the campaign.

Explanation: The disinvestment campaign began to exert a significant impact on South Africa's economy subsequent to the involvement of major Western nations, including the United States, commencing in mid-1984, which led to considerable capital flight.

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What measures did the South African government impose in September 1985 to restrict capital outflow?

Answer: Established a system of exchange control and a debt repayments standstill.

Explanation: The government instituted a system of exchange controls and a standstill on debt repayments. Exchange controls generally prohibited South African residents from repatriating capital, and foreign investors were restricted to withdrawing investments through the financial rand, which traded at a discount.

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Key Figures and Divergent Perspectives

Leon Sullivan was a South African politician who authored the Sullivan Principles.

Answer: False

Explanation: Leon Sullivan was an African-American clergyman from Philadelphia and a member of the General Motors board of directors, not a South African politician.

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Mangosuthu Buthelezi argued that disinvestment would benefit Black South Africans by creating new economic opportunities.

Answer: False

Explanation: Mangosuthu Buthelezi argued that disinvestment would harm Black South Africans and exacerbate hardships, contrary to creating new economic opportunities.

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Margaret Thatcher believed sanctions and disinvestment were the path to prosperity for South Africa.

Answer: False

Explanation: British Prime Minister Margaret Thatcher characterized sanctions and disinvestment as "the path toward poverty, starvation, and the annihilation of the hopes of the very people—all of them—whom one seeks to assist."

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John Major, as Foreign Secretary, supported Margaret Thatcher's stance against tougher sanctions throughout the apartheid era.

Answer: False

Explanation: John Major, who served as Foreign Secretary under Prime Minister Thatcher, later stated in 2013 that the Conservative government had erred in opposing more stringent sanctions against South Africa during the apartheid era.

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Conservatives accused advocates of the disinvestment campaign of hypocrisy for not proposing similar sanctions against the Soviet Union.

Answer: True

Explanation: Numerous conservatives opposed the campaign, alleging hypocrisy among its advocates for failing to propose comparable sanctions against the Soviet Union or the People's Republic of China.

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Libertarian economist Murray Rothbard argued that disinvestment would primarily benefit Black workers in South Africa.

Answer: False

Explanation: Rothbard, a proponent of libertarian economics, contended that disinvestment would disproportionately harm Black workers in South Africa and posited that fostering trade and free market capitalism represented a more effective strategy for rectifying apartheid.

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U.S. President Ronald Reagan favored a policy of 'disinvestment' over 'constructive engagement' with South Africa.

Answer: False

Explanation: Ronald Reagan endorsed a policy of "constructive engagement" with the government in Pretoria, rather than favoring disinvestment.

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Which prominent South African political leader opposed disinvestment, arguing it would harm Black South Africans?

Answer: Mangosuthu Buthelezi

Explanation: Mangosuthu Buthelezi, serving as Chief Minister of KwaZulu and president of the Inkatha Freedom Party, opposed disinvestment, arguing it would inflict harm upon all inhabitants of Southern Africa, particularly Black South Africans.

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What was Margaret Thatcher's perspective on sanctions and disinvestment against South Africa?

Answer: She described sanctions and disinvestment as leading to poverty, starvation, and dashed hopes.

Explanation: British Prime Minister Margaret Thatcher characterized sanctions and disinvestment as "the path toward poverty, starvation, and the annihilation of the hopes of the very people—all of them—whom one seeks to assist."

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What policy did U.S. President Ronald Reagan favor over disinvestment?

Answer: Constructive engagement

Explanation: Ronald Reagan endorsed a policy of "constructive engagement" with the government in Pretoria, rather than favoring disinvestment.

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