[Letter] Difficult regulations stymie growth

Chris Hattingh | 30 Aug, 2022
With a small economy such as ours, regulations and policies that make it more difficult for skilled foreign workers and businesses to invest time and capital here, represent a serious risk to future economic growth.

As countries move out of Covid-19 and the associated lockdowns some will turn inward with protectionist policies, and others will look for opportunities to open up their economies. SA risks falling into the former category.

With a small economy such as ours, regulations and policies that make it more difficult for skilled foreign workers and businesses to invest time and capital here, represent a serious risk to future economic growth.

French Foreign Trade Advisors chair Jean-Claude Lasserre recently indicated that more than 370 French companies (employing about 65,000 South Africans) have promised investments worth more than R50bn in the country. However, the expertise needed to actualise the operations and investments is being held up by visa delays. Some experts have been forced to wait more than seven months.

Capital will not wait forever. Should these companies find opportunities in other countries they are likely to pare back business in SA, and move. That means less capital formation, fewer opportunities for skills development, and thousands of lost job opportunities SA citizens could have enjoyed.

The many promises of job summits and presidential edicts mean little without substantive levels of capital investment and long-term growth. Given the country’s exceedingly high unemployment rate, SA can ill afford not to get the basics of a modern, open economy right.

This letter was originally published here.

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