South Africa: How Does Government Balance Regulating Foreign-Owned Businesses With the Drive for Investment?


The South African government says it is looking at legislation to regulate the conduct of foreign-owned businesses in the country. While there are already several laws in place, government would do well to look at what the rest of Africa does in this regard.

Small Business Development Minister Khumbudzo Ntshavheni's move to set in motion legislative intervention to regulate the participation of foreign nationals in South Africa's economy is contentious, yet a subject that cannot be avoided forever.

According to Ntshavheni, the proposed law will be based on lessons and best practices from countries such as Nigeria, Ethiopia, Tanzania, Ghana, Bangladesh, Pakistan and Botswana that have regulations specifying the sectors where foreign nationals are not allowed to participate or are restricted in their participation.

"We want to strengthen the protection for the locals", said Ntshavheni.

The minister also said South Africa has no system in place to account for the businesses conducted by foreign nationals, let alone knowing the economic impact of their participation in the South African stream of commerce. By "system" I am going to assume that the minster did not mean that there is no legislation that addresses restrictions in some form or shape for different sectors....

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