WHITE PAPER ON INTERNATIONAL IMMIGRATION
17 May 2000PRESENTATION BY BUSINESS SOUTH AFRICA TO PARLIAMENTARY PORTFOLIO COMMITTEE ON HOME AFFAIRS
Introduction
Business South Africa is a confederation of 19 business and employer organisations with membership covering all sectors. BSA is a member of the IOE and the Pan African Employers’ Confederation as well as the SADC Employers Group. As the most representative employer body in the country we are the SA Business representative in the ILO.
BSA’s approach
BSA views the subject of immigration as of the gravest consequence because a country’s attitude to immigration demonstrates the spirit of the community, either to view the outside world as a lot of suspicious strangers wanting to steal all you’ve got or to accept willingly becoming integrated into the modern world and all that it entails.
We have put BSA’s position in our written response of 9 May 2000. The principles we propose are fairly simple and I can summarise them briefly. Before doing that we must say that we have the greatest respect for the team that produced the White Paper. They have not hesitated to put forward controversial and sometimes courageous arguments, which are not all politically correct at present, even when true. Their work is of a high intellectual quality although we are not ecstatic about the way the White Paper is set out, which we find confusing. In recent seminars in Zambia and Zimbabwe organised by the International Organisation of Migration and the International Organisation of Employers, all other African countries were highly complimentary of the work done in the White Paper. We do, however, disagree with the levy as the prime process for control of legal immigrants postulated by the White Paper because we believe it to be a compromise solution which is socially and economically self defeating.
Summary of BSA views
In brief summary of the views expressed in our written document we would like to say the following:
We don’t come forward professing brilliant solutions to interrupt the stream of illegal immigrants. Many of life’s most profound problems, it has been said, cannot be solved. They can only be outgrown and the challenge is to manage them as well as we can until this happens.
We support the general tenor of the White Paper proposals in regard to the control of illegal immigrants.
The main feature of our response to the White Paper, which we would like to press upon you today, is our conviction that our economic self-interest justifies a benevolent policy towards skilled or entrepreneurial migrants able to add to our growth and prosperity. Business is not interested in doing the migrants a favour. Pure, unadulterated self-interest of the country as a whole is we believe best served in this way.
It is pointed out in the White Paper that even without a levy business will naturally prefer citizens if they are available, for practical economic reasons. This is absolutely correct. Business often faces a kind of paranoid belief, without evidence, that Business in general would chose migrants above citizens and prefer this to training citizens wherever possible. This is far from the truth. The Labour Market Commission report also favoured relaxation of the approach to the granting of immigration and work permits, endorsing a more liberal policy to skilled migrants and the entry of foreigners for business and trade.
Associated with this point are urgent needs for some other things –simplification of procedures, speed, de-bureaucratisation, the need for clear legislative and policy guidelines, and the right of appeal to a judicial process as the ultimate guarantee against arbitrary or unreasonable administrative action.
The final point in this brief summary concerns our bilateral labour agreements and practices with our neighbours. Here we share Cosatu’s sentiments expressed in its response to the White Paper that development of a migration policy must be discussed with our neighbours and preferably as part of a broader regional economic development plan before any changes are brought about. Of course we are obliged to honour the letter, but more importantly the spirit of these agreements and practices. The social, economic and political stability of many of our neighbours is closely interrelated with the opportunities for work historically provided in South Africa. In Lesotho miners’ remittances have often exceeded half of GDP. These are legal migrants, most of whom have a legitimate expectation of security of tenure provided work remains available. They are subject to control, scrutiny and repatriation on termination of employment. They are not part of any of the problems relating to illegal immigrants and we do not believe that they should be caught in the crossfire.
The 1998 Draft Protocol on the Facilitation of Movement within the SADC is relevant here. The ultimate aim is the progressive elimination of all obstacles. One of the objectives of the SADC Employment and Labour sector established in 1995 was to facilitate labour mobility. There is a sort of breach of trust in moving in the opposite direction. The original of the draft Social Charter of the SADC specifically envisaged free movement of persons and while these instruments are not at all settled, the tenor and vision of the SADC as an integrated community clearly tends towards a liberal approach to the movement of labour.
The mining industry in particular would like assurances that the present legal immigrants may continue to work and where necessary that they may be replaced by other legal immigrants so that the present level or proportion of immigrants is maintained until matters are clarified with our neighbours.
Expansion on issue of skills
That is basically a bird’s eye view of BSA’s position, but we would like to expand a little on our approach to skills. The market is not what is called a zero sum game with a finite pool of employment. It is an expanding market of opportunities, growing exponentially as more people work and consume, wherever they came from.
We are not advocating completely free movement of skilled immigrants, but we do say that there should be free movement as far as economically and politically feasible. We propose in our response to the White Paper a new draft of the type of work permit clause we would like to see. We would urge the application of a more benevolent regime for the introduction of skilled, professional or entrepreneurial migrants. There are many reasons but consider a few of these points –
1. The headline in the Economist magazine on Monday this week was ‘Africa – the Hopeless Continent’. This may be galling but it is what the world thinks. The article itself is more regretful than critical about Africa but we are not a congenial destination for skilled immigrants.
2. We have major skills shortages inhibiting our growth in all areas from manufacturing to management. This is a matter of public record and it is clearly expressed in the White Paper and the Labour Market Commission Report, amongst others.
3. In a survey of foreign financial institutions operating in South Africa, more than half the respondents experienced difficulty in obtaining medium level financial skills and more than 80% of respondents experienced difficulty in obtaining high level financial skills. Between a third and a half of the respondents indicated difficulties in obtaining work permits for suitably qualified expatriate staff.
4. We know that our immigration statistics are so flawed as to be almost irrelevant. It has been estimated that 300 000 skilled South Africans exited from the country in the last 10 years, a trend that is continuing. Unfortunately we cannot say good riddance because development requires a critical mass of skills. If these skills are lacking, new skills cannot be trained or acquired either.
5. In the USA 1 out of every 4 new startups in Silicon Valley last year was initiated by Indian or Asian immigrants. 50% of Ph.D graduates were immigrants. This is a country which does not even have a program for giving preference to skilled immigrants but which is now under considerable political pressure to do so.
6. Without its immigrant population over the last 200 years America would be technologically backward. At present it is the world leader in technology.
7. Nine out of 10 people in the world live within 100 miles of the place they were born. In this context immigrants are an elite. By risking their future they have already shown an entrepreneurial spirit that is of immense benefit to their new home and which helps to drive its economic growth and development. Studies have suggested that immigrants in America, not necessarily skilled, add at least 1,6 new jobs each. Skilled immigrants alone would cause that figure to double or more. Overall we do not believe that skilled immigrants take away jobs from the local population but do exactly the opposite. Unskilled immigrants can saturate particular jobs although often these are jobs that nobody else wants to do. Even this, however, can drive locals up the ladder into supervisory or more paying jobs.
8. The best evidence shows no positive correlation between migration and unemployment but we are aware of the paucity of information and research in this regard. The most comprehensive research on the economic value of migration in the USA was a mammoth study carried for Congress by the National Academy of Sciences in1997. It concluded that immigration provided a net benefit to the US economy of US $10 billion annually as a minimum estimate, but this was based mainly on the extra value added to production and services by workers, less their wages and social costs. It did not take into account businesses started by immigrants and other indirect benefits, and had it been restricted to skilled migrants the value would have been much higher.
9. Chancellor Gerhard Schroder’s plan to give temporary work permits to 20 000 skilled foreigners to ease the shortage of computer experts in Germany drew fire from unions and conservatives in March this year, raising debate about the nation’s openness to foreigners. The government’s response was that the alternative was to fall irretrievably behind in its efforts to develop the electronics industry to a par with the world leaders. German industry estimated that it needed 75 000 computer experts immediately because it had missed the boat on information technology and could not develop the skills or the capacity to train without these skilled immigrants.
10. Another headline from the Economist, this time last week’s Economist is ‘Europe needs more immigrants’ (May 6–10 edition). We have to compete for these immigrants if we want them.
11. Economist Lester Thurow suggested in the mid 1990’s that in 10 years from then some 50% of jobs as presently known would disappear. This is happening as predicted.
12. As a result of automation, electronics, and changes in the world of work experts predict that blue collar workers and service workers will largely disappear over the next decade. The rest of the work force will be knowledge workers, skilled manufacturing teams, computer systems designers, trainers and professionals. These jobs are developing so fast that our data are completely useless to predict our needs. This is why Business needs to be given some freedom to find the skills it needs anywhere it can.
13. As indicated by Dr Piet Muller of Unisa in a recent address, immediate experience is of greater importance than the potential to be trained successfully. This is because the transfer of knowledge takes place experientially at this level rather than through direct training.
14. That is why we need experts from wherever we can find them – what they do is often not taught at universities but built up from observation and experience. All experts must work as a team and impart knowledge in the process of developing the systems and processes on which they work. We emphasise the fact that to participate successfully in the knowledge economy a state must have a critical mass of highly skilled knowledge workers at its disposal. Only this will enable us to start to build our own expertise. BSA completely disagrees with the assumption that importing skilled migrants where we have such blatant shortages of skills will deleteriously affect training of citizens. Our Skills Development Act and equity legislation requires us to train but this is not at all the only reason to train. Business wants and needs to train its citizens. No business wants to rely on foreign workers for the future security and well-being of that business. It is too risky, expensive, and simply bad management to do so.
15. Many countries are similarly searching for skills, including even Germany and the USA. In the case of South Africa why should we not use the accumulated wealth of technological expertise, capital and resources of the rest of the world to help drive our own economy?
16. Africa has suffered from congenital disadvantages that we need to correct. Apart from colonialism, we struggle with disease, drought, infertile land and many other problems. We live in the tropics and sub-tropics. Of the worlds 30 most developed nations 92,6% of their mass lies in temperate and snow zones. Of the 42 HIPC only 12,5% falls into temperate and snow zones and all of this in entirely landlocked.
17. Europe and other parts of the world, for many reasons relating to geographical circumstances, different cultural needs and pressures, developed a technological base and huge capital resources over thousands of years. There is no point in feeling jealous about this but in order to tap these resources we must be open to the rest of the world and encourage interaction and interdependance.
18. Chapter 17 of David Landes ‘The Wealth and Poverty of Nations’ is titled ‘You need money to make money’. This needs no explanation except that to get that money we need to be receptive to those that have it. We need to encourage traders, businessmen, craftsmen, visitors and other by a quick, simple, efficient and open entry process.
Written response to White Paper
Our detailed views are set out in our response to the White Paper and we shall be happy to deal with any questions arising from the response.
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