South Africa’s new immigration rules could have disastrous consequences for the local economy. We seem to have forgotten we are a developing, emerging market economy and need to do all we can to encourage investment and attract much-needed skills to our country. By introducing such onerous new visa regulations, we are behaving like a first-world country and are in effect turning away from opportunities to create wealth and grow our economy.
South Africa is of course not unique in wanting to tighten up immigration laws. The UK and Switzerland, for example, have made it much harder to obtain both working and tourist visas to visit those countries. But we shouldn’t forget these are first-world countries. We should be following the examples of other developing economies – such as Mauritius, Rwanda and Chile – who are actively encouraging the entry of skilled leadership to help grow their economies.
The new regulations are, quite frankly, mystifying. Government should be doing everything possible to make South Africa an attractive investment destination. These regulations are doing the opposite – we appear to be sending out a message that South Africa has no interest in creating a business-friendly environment and drawing in foreign skills.
The new visa regime is also contrary to international trends. Nowadays, company boardrooms and executive leadership teams are globally much more diverse. And as South African-based multi-nationals expand into the rest of Africa, they increasingly want to appoint board members and executives from other African countries in which they have partnerships.
In a nutshell, we’re living in a global world, and we need to develop a more international flavour on our boards and at senior executive level, if we are going to compete in Africa and further afield. In other words, we need to be removing barriers to entering the global market, not creating more.
We find that the biggest issue for many corporates, in terms of their ability to fill top positions with the skills they need, is the uncertainty. A general work visa is usually a basic requirement, but with the new rules this could now take more than six months to process, without any guarantee of a visa being issued.
The whole process is cumbersome, confusing and very uncertain. Although decisions to refuse visas to companies’ chosen foreign executives can be contested in court, I believe what is more likely to happen is that multi-nationals will simply move their head offices to countries without such severe restrictions on appointing the executives they require. Companies today have choices.
We need to remember that we have competition – there are other emerging markets to which investors will look if we don’t take definitive steps to attract and keep them here. India is a good example – that country’s economy faltered because it was too bureaucratic and not open enough. But whereas India is now doing all it can to turn this around and draw skills and investment into the country, we seem to be closing doors instead of opening them. Ideology seems to be trumping common sense.
The 17th edition of Odgers Berndtson’s global magazine is coming soon.
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