Border issues hurt SA and Zimbabwe’s economy

South Africa’s economy stands to lose greatly from the lack of cooperation between neighbouring governments at the country’s borders, an economist has warned, citing the thousands of travellers fighting to force the Zimbabwean government to allow them to leave the country for South Africa on Monday.

Delays at ports of entry such as the Beitbridge border between South Africa and Zimbabwe made headlines over the festive season as thousands withstood harsh conditions while spending days queuing for a chance to go home for the holidays.

Over the weekend, the International Cross-Border Traders Association (ICTA) expressed outrage after returning travellers were blocked from leaving the country, following stricter Covid-19 regulations announced by the Zimbabwean government.

Economist, Professor Bonke Dumisa said the tougher restrictions at borders may have unpleasant short-term effects, but had long term benefits for South Africa’s economy.

“There is a lack of cooperation between governments at the borders and there is a lot of people capitalising on South Africans being selfish and greedy (by accepting bribes). The direct consequence of that is a lot of money which should be collected in excise duties etc is actually foregone and money which should be used for economic development and service delivery.”

But ICTA president Dennis Juru said the stricter controls, chaos, and delays at Beitbridge have so far been a blow to both economies.

“So far 40% of cross border bus companies failed to reopen their companies and we are expecting more companies to close down due to border closure. 90% of Zimbabweans are jobless and they rely on the Cross Border Trading circle. All those people are facing starvation. South Africans who are working in companies that supply informal Traders from Zimbabwean will lose their jobs,” said Juru.

“Beitbridge is the gateway for the biggest African economy (South Africa) to most SADC countries, this means that small to medium enterprises will have a negative impact on the situation at Beitbridge Border Post. Most indigenous people in both South Africa and Zimbabwe are informal traders. Small to medium businesses are informal traders, meaning that sector will be partially disabled.”

According to Dumisa, those trading in undeclared goods from illicit cross-border trades were stifling competition from local traders operating legally in the informal sector.

“The majority of South Africa’s informal sector are selling legally procured goods. Unfortunately, not all but many of the illegal immigrants in the informal sector are involved in the selling of goods which are not legally procured,” he argued.

“There have been raids here in KZN where it was found at many of the warehouses that there were products which were produced illegally and counterfeit goods. And also there have been raids in many parts of the country where it was found that people were trading in illicit good, including illegally imported and counterfeit goods.”

Simnikiweh@citizen.co.za

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