Why our economy needs foreign owned businesses, and how we benefit from them

Photo: A foreign shop owner stands guard inside his Alexandra spaza shop. EWN/File.

Research by Dr Sally Peberdy of the Gauteng City-Region Observatory (GCRO) shows that far from taking jobs from South Africans, more foreign shop owners in Soweto employ locals that local entrepreneurs.

The research has come into the spotlight after last week’s Soweto attacks sparked by a Somali shop owner allegedly shooting a 14-year-old boy.

Peberdy’s research shows that a majority of foreign nationals who are entrepreneurs are trading legally, and that if the government were to “stop” them from doing business, South Africans would suffer just as much as the foreign nationals.

What we have in terms of foreign traders are people who are creating employment, providing employment for themselves, as well as creating employment for other people. So by trying to put people out of business it would be hurting ourselves, we find that also those traders are buying goods from the formal sector … many of those formal sector suppliers are employing South Africans and are South African businesses … they pay some tax through that. So we would be losing out a lot if we put foreign owned businesses out of business

Researcher, Dr Sally Peberdy

Speaking on 702 after questions were raised around her comments that foreign nationals should share their ideas with local business owners, Minister of Small Business Development, Lindiwe Zulu reminded South Africans that our historical background has disadvantaged a majority of “black South Africans who were left out from participating in the economy of the country”.

Perdeby acknowledged that while Minister Zulu’s point is true, the questions need to be guided towards government to find what the government is doing to better equip local entrepreneurs.

We found that South Africans were more likely to be starting their businesses with less than R5000 than foreign owned businesses … So what we need to be looking at is how do we enable South Africans to capitalize their businesses and find access to capital because we do know that lack of capital does hinder people’s ability to develop business

Researcher, Dr Sally Peberdy

Contrary to the perception that foreigners are “taking over” the informal sector, Perdeby’s research found that 2 out of 10 informal business owners were South African as were nearly nine out of 10 (87%) of formal sector business owners.

The attacks on foreign migrant entrepreneurs and the suggestions to shut them down and so on, is actually going to hurt South Africans, and what we’ve seen in Soweto is a minority of people who are intolerant plus some criminals and opportunists and they are hurting not only those foreign business owners but they are hurting South Africans

Researcher, Dr Sally Peberdy

Listen to Dr Perdeby explain how shutting down foreign nationals’ businesses will have an adverse effect on jobs, rent, suppliers and tax in South Africa:


This article first appeared on 702 : Why our economy needs foreign owned businesses, and how we benefit from them


Recommended

by NEWSROOM AI
Read More
'I got retrenched and it took a toll on my relationship' - on money and intimacy

'I got retrenched and it took a toll on my relationship' - on money and intimacy

Money is one of the top causes of relationship fights and divorce. Dr Eve and callers discuss how it can affect sexual intimacy.

[LISTEN] 'Zuma's administration put the creative sector in the economic cluster'

[LISTEN] 'Zuma's administration put the creative sector in the economic cluster'

Eric Miyeni chats to Africa Melane about some of what's improved SA's film industry and the upcoming South African International Film Festival.

[LISTEN] Why do your eyes become red when you have had a bit too much to drink?

[LISTEN] Why do your eyes become red when you have had a bit too much to drink?

Naked Scientist, Chris Smith explains the science behind overindulging in alcohol.

'They think they're the boss of the road' - Listeners share taxi driver tales

'They think they're the boss of the road' - Listeners share taxi driver tales

702/CapeTalk listeners share stories of having been violently harassed by taxi drivers and feel the government needs to act on it.

Looking for a new read? Author and columnist Kate Sidley reviews five new books

Looking for a new read? Author and columnist Kate Sidley reviews five new books

Author, columnist, and editor Kate Sidley's enticing reviews that may have you running to the nearest bookstore.

Post-Parly brawl Minister Zulu: 'To those disappointed with me, I apologise'

Post-Parly brawl Minister Zulu: 'To those disappointed with me, I apologise'

Minister of Small Business Development, Lindiwe Zulu has since apologised after having to be physically restrained in Parliament.

Popular articles
[LISTEN] Why is contemporary art booming in Cape Town?

[LISTEN] Why is contemporary art booming in Cape Town?

'Cape Town art eco-system is vibrant' says Mary Corrigall - Founder of Corrigall & Co

DStv subscription price hikes for 2019

DStv subscription price hikes for 2019

MultiChoice will increase the prices of certain DStv packages from 1 April.

'Bring back skilled engineers to Eskom' - Solidarity

'Bring back skilled engineers to Eskom' - Solidarity

Trade Union Solidarity says it supports Pravin Gordhan's idea that technicians who used to work for Eskom should be brought back.

[LISTEN] Discovery Health defends decision to shift certain ops to day hospitals

[LISTEN] Discovery Health defends decision to shift certain ops to day hospitals

Kieno Kammies speaks to Dr Ryan Noach Deputy Chief Executive at Discovery Health and Dr K who says his patients are suffering.

Here's how to check your load shedding schedule in Cape Town

Here's how to check your load shedding schedule in Cape Town

Eskom has warned that more power cuts can be expected as maintenance continues over the next twelve months.

Criminals targeting homes with aluminium windows, warns neighborhood watch

Criminals targeting homes with aluminium windows, warns neighborhood watch

The Panorama, Welgelegen and Plattekloof Neighbourhood Watch has identified a new house break-in trend.

3 emergency numbers you should have on speed dial and how they work

3 emergency numbers you should have on speed dial and how they work

These are the emergency numbers you should have on your cellphone and this is what you must understand about how they work.