Botswana restricts business activities for foreigners

“It’s tough out here. But going home is not an option, I will stick around if they enforce the law, I will look for something else here,” said Thomas Ncube, 32, (not his real name) a Zimbabwean owner of a butchery in Gaborone, Botswana.

Speaking via telephone, he said he lived in South Africa before. He left in 2015 after xenophobic attacks that ensued after the late Zulu king, Goodwill Zwelithini, declared that foreigners should “go back to their countries”.

At the time, he was a street vendor in Durban.

Now, his livelihood is under threat, with Botswana moving ahead to enforce the Industrial Development Act of 2019 and its Regulations of 2020.

The law seeks to ring-fence business activities reserved for locals, and “perpetrators” will be prosecuted.

A statement, dated 3 November 2021, issued by that country’s Ministry of Investment, Trade and Industry highlighted some of the businesses that include wholesale retail and filling stations (petroleum).

The protected list has 21 business crafts, ranging from bread and confectionery to furniture.

Back home in Zimbabwe, Ncube graduated as a primary school teacher and did not go into formal employment because salaries were relatively low.

He was better off as a gardener or security guard in South Africa.

But during the late Robert Mugabe’s presidency, a similar law was enacted.

It backfired spectacularly and was reversed by his successor, Emmerson Mnangagwa.

Ncube said:

One of the most protectionist countries in the region used to be Zimbabwe. We had a 51% local ownership for all businesses, even our television had a 75% local content policy. What was the result? Standard of living dropped dramatically. The end result of our economy is partly because of protectionist policies.

Mnangagwa, in a bid to get foreign direct investment (FDI), amended the Indigenisation Act.

In June this year, Zimbabwe gave a reprieve to foreigners already in the reserved sub-sectors because they had invested for years.

However, no new foreigners will be licenced.

Zimbabwe’s reserved sectors for locals are similar to Botswana’s.

These are transport, wholesale retail, advertising, hair salons, bread and confectionery, arts and crafts.

Covid-19 impact

Covid-19 had negative impacts on the SADC economy; member states are finding ways of survival, and a “my people first” attitude has arisen.

“As the pressure mounts, industries are moving swiftly to build resilience, while governments are mobilising to safeguard citizens and manage the social and economic fallout,” read an economic outlook statement by SADC.

In South Africa, President Cyril Ramaphosa signed the Private Security Industry Regulation Amendment Act last month.

Part of its provisions is that all security companies should retain 51% South African ownership.

The act also gives the police minister the power to change the ownership percentage if he deems it a national security issue.

The DA is against this clause in the legislation because it could lead to “international disinvestment”.

Ownership of businesses in reserved areas for locals has a direct link with migration patterns.

Between March and June this year, 18 000 Zimbabweans were deported from South Africa, eSwatini and Lesotho through the Beitbridge border post.

Figures from Zimbabwe’s consular affairs office in Pretoria estimate that about 150 people from the Lindela Detention Centre in Johannesburg and detention centres in Limpopo are deported monthly.

Botswana has deported at least 500 people to Zimbabwe in the past few months.

Some have taken the issue to the UN High Commissioner for Refugees (UNHCR) to appeal Botswana’s stance.

A 2020 report by the UN Department of Economic and Social Affairs (DESA) on Main Intra-African Migration Routes, said the desire for a better life and opportunities was the key driver of migration.

In southern Africa in particular, South Africa is the destination of choice by virtue of being the biggest economy in the region.

With migration traffic directed to South Africa and Botswana, governments in both countries are faced with a harsh reality.

Stevenson Dhlamini, an economics lecturer at Zimbabwe’s University of Science and Technology, said: There is talk of foreigners taking jobs and business opportunities from locals in both countries. There is also the crime factor blamed on foreigners too. But to be honest it’s a two-way street.

“Migrants at times get jobs and business opportunities ahead of locals but they also live in the same economy and that alone leads to employment creation in service industries,” said Dhlamini.

He added that instead of blocking foreigners from operating in sub-sectors, countries should come up with other methods.

“If foreigners interested in these so-called sub-sectors of the economy reserved for locals are taxed more than the locals that could work. It means that foreigners would have to be exceptionally good at their craft to compete with locals instead of shutting them out, at the same time risking poor service delivery,” Dhlamini said.

Some South African politicians blame (illegal) migration, mostly from Zimbabwe, as the source of the problem.

In July last year when there were foiled riots in Zimbabwe, the ANC dispatched an envoy to Harare.

The ANC delegation, led by Ace Magashule, sought to help Zimbabwe because an unstable neighbour up north meant a huge influx of economic refugees at a time when unemployment levels were on the rise in South Africa.

But EFF leader Julius Malema early this year urged people from the SADC region to “find a creative ways” to enter South Africa after the government tightened border controls to fight an influx of undocumented foreigners.  News24

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