Story audio is generated using AI
Standard Bank Group CEO Sim Tshabalala says South Africa should look to the UK’s departure from the EU as evidence of the economic cost of restricting migration.Speaking at a Kgalema Motlanthe Foundation winter seminar, Tshabalala said the UK’s exit from the EU was driven largely by concerns over migration. But the outcome offers a cautionary lesson rather than a template for South Africa. He said Brexit cut UK GDP by 6%-8%, reduced investment 13% and pushed unemployment up about 4% relative to a scenario in which Britain had remained in the bloc.His comments coincide with an overhaul of South Africa’s immigration architecture. The cabinet approved a revised white paper on citizenship, immigration and refugee protection in April, consolidating the Citizenship, Immigration and Refugees acts into a single law. The reform introduces a points-based system for certain visas and permanent residency and new visa categories for remote work, start-ups and skilled workers. It retains South Africa’s commitments under the 1951 Refugee Convention after an earlier withdrawal proposal was dropped.The department of home affairs last week opened the second phase of its Trusted Employer Scheme, which fast-tracks visa processing for accredited employers recruiting senior executives, technical staff and investors.Standard Bank has a footprint in 20 countries on the continent and generated R49bn in earnings last year, with about 40% of that coming from operations outside South Africa. The bank paid R10.3bn in tax outside the country and R7.7bn domestically.Some of South Africa’s largest companies also operate on the continent, including Goldfields, Sasol, Vodafone, Absa, First Rand, Shoprite, Spar, Aspen and MultiChoice.The remarks came during a broader defence of migration’s economic contribution to South Africa after mass demonstrations by anti-immigrant groups in the country. Tshabalala pushed back on the argument that foreign nationals take jobs, depress wages and contribute little to the country, calling the claim unsupported by evidence. Migrants function as consumers, tenants, borrowers and entrepreneurs as well as workers, Tshabalala said, adding that they pay tax either directly through employment or indirectly through value-added tax on goods and services. He said the notion that migrants strain the state’s ability to serve citizens is not borne out by the data.“Further, immigration … has the effect of reducing unemployment, not increasing [it],” Tshabalala said.“This actually makes a lot of sense to think about. Migrants are not only workers; they are also consumers. They are tenants. They are commuters. They are farmers, they are borrowers, they are traders and they are entrepreneurs.”He said migrants increase the demand for goods as well as the supply of labour. “They rent rooms. They buy food. They use transport. They pay school fees. They start small businesses and they create jobs for local people. In many settings, they also full the shortages, they broaden skills, and they deepen commercial links,” he said. “We should also say clearly that migrants also pay tax. Those in the formal system will pay tax by way of employment tax; those that are outside the system will buy food, they buy petrol, they buy goods, and they will pay VAT and thereby contribute to the tax system,” he said, adding that the claim that immigrants diminish the government’s ability to serve citizens is untrue. “It is not supported by the data either.” They rent rooms. They buy food. They use transport. They pay school fees. They start small businesses and they create jobs for local people.... We should also say clearly that migrants also pay tax. — Sim Tshabalala, Standard Bank Group CEO Tshabalala also pointed to the scale of corporate investment flowing between South Africa and the rest of the continent. He said South African direct investment into Africa totals about R500bn, while investment from African entrepreneurs into South Africa stands at about R64bn. Other speakers at the seminar linked the migration debate to recent unrest.Former president Kgalema Motlanthe said governance failures and weak economic growth, not migration itself, are driving xenophobic violence and that populist leaders have exploited competition for limited resources among poor communities. He said the central government must act promptly and warned that political instability is a precondition for economic instability.WATCH | Former president Kgalema Motlanthe speaks on managing the perception of how other African countries see the manner in which South Africa is dealing with the migration issue. pic.twitter.com/jOCeZyLQa7— Times LIVE (@TimesLIVE) July 23, 2026
