S. Africa braces for eco­nomic back­lash from at­tacks

The China Post - - BUSINESS - BY JEAN LIOU

A wave of xeno­pho­bic at­tacks in South Africa could pro­voke reprisals from neigh­bor­ing coun­tries, rais­ing con­cerns among South African busi­ness lead­ers and of­fi­cials that the vi­o­lence against for­eign­ers could fur­ther dam­age the weak econ­omy.

Calls for a boy­cott of South African prod­ucts have mul­ti­plied amid anger in Malawi, Zam­bia, Mozam­bique and else­where on the con­ti­nent over their cit­i­zens be­ing at­tacked by mobs in Jo­han­nes­burg and Dur­ban.

At least seven peo­ple have been killed in the vi­o­lence and thou­sands of im­mi­grants forced to flee their homes, mak­ing head­line news around the world as sol­diers were de­ployed to re­store or­der in the im­pov­er­ished town­ships.

“Since the start of the at­tacks, our coun­try has lost bil­lions of rands in ex­port for­eign rev­enue,” trade and in­dus­try Deputy Min­is­ter Mzwandile Masina said Wed­nes­day, with­out giv­ing fur­ther de­tails.

Call­ing the sit­u­a­tion “un­ten­able,” he added that the gov­ern­ment was “wor­ried about the cost and the neg­a­tive im­pact of the at­tacks on for­eign na­tion­als on the coun­try’s im­age and its econ­omy.”

“We can­not have th­ese at­tacks con­tin­u­ing,” he said.

Nige­ria’s for­eign min­istry sum­moned South Africa’s high com­mis­sioner over the at­tacks, while in­flu­en­tial Zim­babwe Na­tional Stu­dents Union pres­i­dent Gil­bert Mu­tubuki called on youths to tar­get lo­cal South African busi­nesses.

Mu­tubuki was re­ported to have named the su­per­mar­ket chain Pick n Pay as one pos­si­ble tar­get.

Other South African brand names op­er­at­ing across south­ern Africa in­clude such gi­ants as the MTN tele­coms group, Sho­prite, Old Mu­tual in­surer and the Stan­dard Bank and Ned­bank.

“We are ap­peal­ing to dif­fer­ent African coun­tries not to re­tal­i­ate ... be­cause it won’t help any­body,” Bene M’Poko, the Demo­cratic Repub­lic of Congo’s am­bas­sador to South Africa, said this week.

In Mozam­bique, South African petro­chem­i­cals group Sa­sol evac­u­ated 340 staff and sent them back home, while Ir­ish min­ing firm Ken­mare Re­sources repa­tri­ated 62 work­ers.

Ex­ports to Africa

“What’s been go­ing on in South Africa is of grave con­cern and it’s dis­heart­en­ing. Sa­sol is a South African com­pany, but we are global,” Sa­sol spokesman Alex An­der­son told AFP.

“Sa­sol be­came aware of un­rest by the Mozam­bi­can em­ploy­ees of our con­trac­tors.”

Last week, about 200 peo­ple in Mozam­bique briefly block­aded the bor­der and threw rocks at South African ve­hi­cles.

South Africa’s eco­nomic growth slowed to 1.5 per­cent last year from 2.2 per­cent in 2013, and far from the 5 per­cent growth rate be­fore the global eco­nomic cri­sis. The coun­try runs a large trade bal­ance sur­plus with the rest of Africa.

Eco­nomic Devel­op­ment Min­is­ter Ebrahim Pa­tel said South Africa re­lied on ex­ports of cars, clothes and tex­tiles.

“We sell 260 bil­lion rand (NT$645.2 bil­lion, US$21 bil­lion) worth of goods to other African coun­tries ... that cre­ates more than 160,000 jobs in South Africa,” he said.

Pa­tel ad­dressed the thorny is­sue of im­mi­grants tak­ing jobs for less pay than lo­cals, fu­elling frus­tra­tion that im­mi­grants “steal” South African jobs.

“We must make it clear to com­pa­nies: don’t ex­ploit for­eign work­ers,” he said.

“Don’t pay them less than South African work­ers ... so much so that South African work­ers are put aside.” For Ned­bank an­a­lyst Den­nis Syke, gov­ern­ment ac­tion in the com­ing weeks is key to lim­it­ing the dam­age.

“Gov­ern­ment re­sponse ini­tially was I think fairly weak, but it is im­prov­ing now and there seems to be more de­ter­mi­na­tion to try and get things sorted out,” he said.

Tourism — a ma­jor in­dus­try in South Africa — re­mains vul­ner­a­ble, de­spite the un­rest not spread­ing to Cape Town, the wine­grow­ing re­gions or sa­fari re­sorts.

Sev­eral for­eign min­istries, in- clud­ing those of the United King­dom and Australia, have up­dated their travel ad­vi­sories to high­light the un­rest.

“The xeno­pho­bic vi­o­lence you hear about in South Africa does not tar­get tourists and does not af­fect tourist re­gions,” tour op­er­a­tor Onne Veg­ter wrote in an ed­i­to­rial for the spe­cial­ist Tourism Up­date web­site.

But it added that the sit­u­a­tion is “a PR dis­as­ter for us, as our coun­try is once again in the news for all the wrong rea­sons.”


Thou­sands of peo­ple march­ing against the re­cent wave of xeno­pho­bic at­tacks in South Africa through the streets of Jo­han­nes­burg are seen in a shop win­dow on Thurs­day, April 23.

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