DA condemns xenophobic ANC MK Vets’ economic terrorism

6 November 2020

The Democratic Alliance (DA) condemns the xenophobic violence perpetrated against immigrant-owned businesses in Durban by the ANC MKMVA this week, and calls on the ANC to take action against these “vigilante veterans” in its ranks.

We also urge the South African Police Services (SAPS) to provide protection to these small businesses in light of the MKVA’s intimidation.

This malicious campaign to shut down these small enterprises is nothing short of economic terrorism, and these appalling acts have no place in our constitutional democracy.

The DA supports effective enforcement of reasonable legal requirements for immigrant-owned businesses, however any alleged non-compliance to these requirements, whether related to tax or municipal trading regulations, can never be an excuse for vandalism, xenophobia and intimidation.

It is erroneous zero-sum thinking from the ANC MKMVA to posit that, in the small business ecosystem, some must lose or shrink in order for others to win or grow, as well as being a false and limited perspective which only sees a finite pie to be shared, rather than realising the prospects for increasing the size of the pie to the benefit of all.

Furthermore, there has been a demonstrable positive effect for consumers from the participation of immigrant-owned micro-retailers in the form of greater affordability of goods owing to their cost-saving practices, and greater access and convenience  due to the proliferation of these micro-retail outlets, especially in township and informal settlement communities.

Various studies have shown that the competitive advantage enjoyed by immigrant-owned retail micro-enterprises is based on them leveraging bulk-buying for price discounts and economies of scale, as well as sharing debt through peer-to-peer micro-financing. In addition, immigrant spaza shop owners have been found to invest larger capital outlays on average in their micro-enterprises.

The DA would therefore support a policy approach that promotes and encourages partnerships and sharing of best practice between immigrants and South Africans in the micro-retail sector, instead of simply shutting immigrants out of economic sectors, as the recently proposed Gauteng Township Economic Development Bill seeks to do.

Issued by Zakhele Mbhele, DA Shadow Minister of Small Business Development, 6 November 2020