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If Foreigners Leave South Africa The Economy Will Collapse. Here's Why (Opinion).

If Foreigners Leave South Africa The Economy Will Collapse. Here's Why (Opinion). 

The past two weeks have been hard for foreigners in South Africa. South Africans want foreigners gone and they want their jobs back but what South Africans do not know is that the economy will collapse without foreigners. 


Foreigners are usually employed in the restuarants and hospitality industries. The owners of these industries employ foreigners at cheap labour which is below minimum wage so that they can make more profit and keep their businesses running. Chances are, if they employ South Africans at minimum wage then their businesses will likely fail and the state loses on some tax. Losing tax is not good for the economy as the little reserves that the country depends on will be decreased. This also means that the unemployment rate will increase even further. 

Besides the hospitality industry, foreigners usually go for the informal economy for income. This of course include the stalls burnt down at the Bara Taxi Rank the past week or so. Stats SA stated that the informal economy contributes about 5.2% to the South African GDP while other estimates place the contribution of the informal economy to 15-18% of the GDP. That is a lot of money considering that if most of these people left the country, the GDP would decrease gradually. 

The ruling government somehow knows the contributions the foreigners make to the South African economy and maybe that is why they have not been paying attention to the issue. 


While South Africans are adamant to have foreigners leave the country, the question that remains is that will South Africans be willing to take on the small business sector that the foreigners have taken on for the little income they had? Will South Africans be willing to be paid below the minimum wage?


Source: https://www.google.com/amp/s/lowvelder.co.za/619561/informal-sector-in-dire-situation-yet-contributes-billions-to-economy/%3fpwa-amp&


https://content.wisestep.com/top-advantages-disadvantages-hiring-foreign-workers/

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