SA Migration International

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How migrant entrepreneurs play a role in easing lives of SAâ€™s poorest

Source: SA Migration, 06/03/2018

There is a marked contrast between what 60% of South Africans believe
about migrant entrepreneurs from Somalia, Nigeria and Senegal who
live in Cape Town and actual findings confirmed by research. A survey
in 2010 found that the majority of South Africans believed that one
of the reasons for the xenophobic violence in 2008 was that migrants
were taking jobs from South Africans, that they were engaging in
illegal and other nefarious business practices and driving local
small businesses to the wall.
However, a study of migrant entrepreneurs from these countries ï¿½` and
confirmed in the Southern African Migration Programme survey
conducted in Johannesburg and Cape Town ï¿½` found that, contrary to
these beliefs, migrant entrepreneurs create jobs for other migrants
and South Africans, slightly favouring the employment of South
Africans.
Other findings were that migrant entrepreneurs also make other
contributions to SAâ€™s economy.
All evidence points to the fact that migrant businesses source their
goods in the formal economy and contribute to the tax base by paying
value-added tax. They have also introduced a diverse range of
products, business activities and opportunities and brought scarce
manufacturing skills into the township economy.
Key beneficiaries are poorer consumers who can access cheap goods,
often in appropriate quantities and at convenient times of day and
locations. The migrant entrepreneursâ€™ competitive edge stems from
careful attention to product sourcing and servicing customer needs ï¿½`
their business model is based on low mark-ups and high turnover,
making a greater variety of goods available in flexible quantities, a
culture of thrift and the long hours they are prepared to work.
Under any other circumstances, they would probably be praised as
shining examples of micro-entrepreneurship. But the government and
many citizens view their activities as undesirable solely because of
their national origins and the ease with which they can be
scapegoated as the cause of unrelated political and economic issues.
Harassment, extortion and the bribery of officials are among the
daily costs of doing business for migrants in SA. Many entrepreneurs,
especially in informal settlements and townships, face constant
threats to their security and minimal protection from the police ï¿½` in
addition to the constraints they face simply because they operate
informally.
In SA, the informal economy has at best been ignored and at worst
actively discouraged. The antimigrant sentiment is driving a process
of severe regulation that will further endanger the livelihoods of
migrant entrepreneurs.
In the past decade, there has been a retrogression in the policy
environment relating to migrant entrepreneurs, asylum seekers and
refugees. SAâ€™s migration and refugee policy has shifted away from the
former integrationist approach to one of containment and repulsion.
This is most evident in the 2016 Refugees Amendment Act, the recent
green paper on International Migration in SA and the current
construction of what the Department of Home Affairs has termed `a
processing centre` near Messina, Limpopo. Only 10% of international
migrants who have applied for asylum or refugee status have been
granted this status. The government believes only 10% of the
applicants are asylum or refugee status seekers ï¿½` the rest are
economic migrants. This remains their argument despite the consensus
among experts and researchers that the percentage of actual refugees
and asylum seekers is considerably higher than 10% and that migrants
have a positive effect on national economies.
According to the 2015 white paper, there were 78,339 active asylum-
seeker permits. Public education initiatives to educate South African
citizens on issues of xenophobia have not had any measurable effect,
due largely to legislation, policy and attitudes in the government
becoming increasingly unwelcoming of migrants and the seemingly
intractable xenophobic attitude of about 60% of South Africans.
Legal challenges to government departments, municipalities and metros
have had far more success because of the tenets of the Constitution
and the inclusive and comprehensive rights it assures to any persons
residing in SA ï¿½` both citizen and noncitizen alike.
One of the greatest challenges for migrants in SA is maintaining
their self-reliance and assuring their right to work within the
informal sector. Social protection of vulnerable migrant communities
in SA needs to focus on protecting migrant-owned small, medium and
micro-enterprises in the informal sector. These businesses are the
migrantsâ€™ main source of income security and if their livelihoods are
to be sustainably protected and community resilience maintained,
their rights in this area are vital.
It is possible the legal challenges could set an important precedent
in favour of these communities and form a key part of a sustainable
solution to the problem of ensuring their social, legal and economic
protection.
The governmentâ€™s argument is that its change of approach has been
driven by the overwhelming number of international migrants home
affairs has had to process. The deleterious effects this influx can
have on the national economy and SAâ€™s social cohesion are simply not
borne out by the facts.
In contrast, the facts lead to an understanding that the services
provided by migrant entrepreneurs to poorer households in the
townships (credit, smaller product quantities and a greater variety
of goods) play a key role in food security strategies for these
households.
Rather than the negative effect the government argues international
migrants have, we see that on aggregate their businesses benefit the
most vulnerable in SA and the economy. Do we need to ask who else
would provide these services, if not migrants?
The migrant entrepreneurs are also among the most dedicated and
resourceful entrepreneurs in SAâ€™s informal economy. There needs to be
an acceptance by the government and the public that neither the
informal economy nor the migrants will go away.
Both are indispensable because they fulfil vital needs and services
to the poorest of the poor. They are quite simply filling a gap in
the market, and their businesses should be, at the least, left alone
and, at the most, supported by the government and citizens.

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