Johannesburg, 22 April 2015: FinMark Trust is concerned with the recent spate of xenophobic violence in South Africa as it is contrary to the very fundamentals of regional integration which is essentially based on the creation of a wider economic space for inclusive growth.
As an organisation dealing with financial markets, FinMark Trust has undertaken a number of research studies covering inter-alia access to financial services, insurance, payments and remittances with a view to better understand the drivers and obstacles to regional financial integration and financial inclusion. All these studies point out to the sophistication of the South African financial market. Studies conducted by other organisations in other fields that considered drivers and enablers of regional integration also indicate that the South African economy can effectively be the locomotive of the SADC regional integration agenda. To sum it all, South Africa is the power house in the region.
To the ordinary citizens of the countries neighbouring South Africa, this is the country of opportunities with its track record in upholding the values of human dignity and democratic principles. For these reasons there has been an influx of migration towards South Africa since 1994. A study conducted by FinMark Trust in 2012 revealed that migrant workers in South Africa remit a huge proportion of the earnings to support their families back home. Because of their situation in South Africa, some 68% of the remittances from the migrant workers are sent through risky informal channels. Many of these migrants have made South Africa their extended homes as they felt a sense of security, cultural affinity and belonging.
The recent spate of xenophobic violence in South Africa is in direct contradiction to the Regional Financial Integration agenda that is supported by FinMark Trust. Through this regional agenda, FinMark seeks to promote the broadening and deepening of financial links within SADC. The process involves eliminating barriers to cross-border investment and yet the attacks do not help the process of nation building and integration. It defeats that sense of belonging and unity of purpose which are the cornerstones of the SADC Treaty and its protocols.
Already the threats of retaliation from neighbouring countries do not augur well for South Africa which has much economic vested interest in the region. Companies such as Shoprite Holdings Limited which report to have almost 290 retail outlets in SADC countries and Standard Bank which is the largest bank on the continent have much to lose. Not only will this impact on the earnings of these South African companies but it will also impact on the South African economy.
In addition, the backlash of the xenophobic violence in South Africa will have serious adverse consequences on the work of South African based institutions like FinMark Trust which is operating in the region and requires the collaboration of the regional stakeholders. The attack on foreigners in South Africa have far reaching consequences on our social, political and economic relations with the continent and the rest of the world and is damaging the country’s image internationally. The economic impacts will be felt most acutely in South Africa. It will also have a negative impact on the livelihoods of poor families across the region.
A multipronged approach is required for the effective integration of migrants into society and this can be achieved through ensuring that the rights of migrants are respected constitutionally and in practice including the respect from the migrants for the South African laws and the community norms. Extensive collaboration is also required amongst all institutions in the public, private, academic and civil society sectors to heal the damage done and to prevent similar occurrences in the future.
FinMark Trust encourages South Africans to take a stand against xenophobia and condemns the recent spate of attacks by South Africans against foreign nationals. We encourage South African people to support initiatives and campaigns against such attacks and further call on the South African authorities to do more to effect a safe and secure environment in order to promote the effective integration of migrants into the economy and ensure their access to livelihoods. We also encourage the private companies operating in the region to do more in terms of local employment creation which will contribute to curb the influx of migration into South Africa.