The Institute of Race Relations has released a report titled “What will South Africa lose if all immigrants are sent home?” detailing how the country stands to lose billions of rands if foreigners are shown the door by government.
According to the report, South Africa hosts more undocumented immigrants per capita than wealthier countries like the UK and Germany, and almost as many as the USA.
However the IRR notes that the majority of these immigrants currently contribute to South Africa’s workforce with a 14.6% unemployment rate among foreign immigrants – roughly half to a third of the local unemployment rate.
“Furthermore, they make up 11% of South Africa’s working population, and they make a huge contribution to the South African economy through providing goods and services, paying rent and buying from South African wholesalers,” noted the IRR.
In the context of high levels of xenophobic violence, The IRR set out how much South African stand to lose if all immigrants are sent home:
- Low prices and convenience: Immigrant-owned spaza shops allow township residents to shop on their doorsteps and their prices are usually the cheapest in the city.
- Rentals: Some 70,000 to 90,000 South Africans are now renting their spazas to foreign traders. Immigrants also need places to stay, so they pay commercial as well as residential rents.
- Economic stimulation: The majority of foreign traders started out with capital of R 5,000 or less. Within three years, however, all had at least doubled the value of their businesses, and 40% had amassed R50,000 or more. It’s worth noting that small-scale street traders and spaza operators cannot escape paying VAT on goods purchased from wholesalers, thereby contributing to the nation’s coffers and thus the economy.
The report stressed that sending people fleeing war zones home would be dishonourable and cruel.