Informal Migrant Entrepreneurship And Inclusive Growth In South Africa Zimbabwe And Mozambique

While increasing attention is being paid to the drivers and forms of entrepreneurship in informal economies, much less of this policy and research focus is directed at understanding the links between mobility and informality. This report examines the current state of knowledge about this relationship with particular reference to three countries (Mozambique, South Africa and Zimbabwe) and four cities (Cape Town, Harare, Johannesburg and Maputo), identifying major themes, knowledge gaps, research questions and policy implications.

This report presents the results of a SAMP survey of informal entrepreneurs connected to cross-border trade between Johannesburg and Maputou during 2014. The study sought to enhance the evidence base on the links between migration and informal entrepreneur-ship in Southern African cities and to examine the implications for municipal, national and regional policy.

This report provides a rich view of the activities of migrant entrepreneurs in the informal economy of Johannesburg. It is hoped that the information will facilitate understanding of the informal sector and its potential, and not just in the context of migrant entrepreneurs. The informal economy plays a significant role in the entrepreneurial landscape of the City of Johannesburg and is patronized by most of the citys residents. The research presented here challenges commonly held opinions about migrant entrepreneurs in the City of Johannesburg and shows that they do not dominate the informal economy, which remains largely in the hands of South Africans. In late 2013, the City, through Operation Clean Sweep, removed up to 8,000 traders from the citys streets. As this and recent xenophobic attacks demonstrate, Johannesburg can be a hostile place in which to operate a business as an informal economy migrant entrepreneur. Instead of trying to sweep the streets clean of these small businesses, government at national, provincial and city levels should develop policies to grow the SMME economy, develop township economies, and manage the informal economy and street trading. They need to incorporate the businesses owned by migrant entrepreneurs, rather than exclude and demonize them. These businesses make an invaluable contribution to Johannesburgs economy despite operating in a non-enabling political and policy environment.

Zimbabwe has witnessed the rapid expansion of informal cross-border trading (ICBT) with neighbouring countries over the past two decades. Beginning in the mid-1990s when the country embarked on its Economic Structural Adjustment Programme (ESAP), a large number of people were forced into informal employment through worsening economic conditions and the decline in formal sector jobs. The countrys post-2000 economic col-lapse resulted in the closure of many industries and created market opportunities for the further expansion of ICBT. This report, part of SAMPs Growing Informal Cities series, sought to provide a current picture of ICBT in Zimbabwe by interviewing a sample of 514 Harare-based informal entrepreneurs involved in cross-border trading with South Africa.

This is report is the most comprehensive study yet of the contribution of migrant and refugee entrepreneurs to Cape Town's local economy. The survey of over 500 entrepreneurs engaged in trade, services and manufacturing in different areas of the city dispels some of the more prevalent myths that often attach to the activities of migrants. The vast majority are not "illegal foreigners", but have a legal right to be in South Africa and to run a business. Most are highly motivated individuals who enter the informal economy to earn revenue to support themselves, their families, and because they have a strong entrepreneurial motivation. Contrary to the claims of South African competitors, the vast majority are not successful because they are engaged in shadowy business practices. What emerges from the survey is that while migrant entrepreneurs undoubtedly have strong social networks, their businesses are highly individualistic in terms of organization, ownership and activity in a competitive business environment. This report demonstrates their positive economic contributions to Cape Town and examines the challenges they face in running a successful business operation in the city. It goes beyond the rhetoric of inclusion to demonstrate with hard evidence exactly why migrant and refugee entrepreneurs should be accepted as an integral and valuable part of the local economy.

Debates about international migration in South Africa often centre on the role of international migrant entrepreneurs who are seen to be more successful than their South African counterparts, squeezing them out of entrepreneurial spaces, particularly in townships. This report explores and compares the experiences of international and South African migrant entrepreneurs operating informal sector businesses in Johannesburg.

This report compares the business operations of over 2,000 South Africans and refugees in the urban informal economy and systematically dispels some of the myths that have grown up around their activities. First, the report takes issue with the perception that South Africans are inexperienced and unmotivated participants in the informal economy. Many have years of experience and have successfully grown their businesses. Second, it contests the view that refugees enjoy a competitive advantage because they come to South Africa with inherent talent and already honed skills. On the contrary, over 80% of those surveyed had no prior informal sector experience and learned their skills on the job and after coming to South Africa. Third, the report shows that there is fierce competition in the urban informal sector between and within the two groups. However, business competition between refugees and South Africans is mitigated by the fact that they tend to dominate different sections of the informal economy with South Africans dominant in the food sector and refugees in the household products and personal services sectors. Finally, the report takes issue with recent arguments that all informal sector businesses are equally at risk from robbery, extortion and other crimes. It shows that South Africans are affected but that refugees are far more vulnerable than their South African counterparts. The report therefore confirms that xenophobia and xenophobic violence are major threats to refugees seeking a livelihood in the informal sector, especially if they venture into informal settlements.

One of the defining characteristics of many large cities in the rapidly urbanizing global South is the high degree of informality of shelter, services and economic livelihoods. It is these dynamic, shifting and dangerous informal urban spaces that refugees often arrive in with few resources other than a will to survive, a few social contacts and a drive to support themselves in the absence of financial support from the host government and international agencies. This report addresses the question of variability in economic opportunity and entrepreneurial activity between urban environments within the same destination country - South Africa - by comparing refugee entrepreneurship in Cape Town, South Africa’s second largest city, and several small towns in the province of Limpopo. The research shows that refugee entrepreneurial activity in Limpopo is a more recent phenomenon and largely a function of refugees moving from large cities such as Johannesburg where their businesses and lives are in greater danger. The refugee populations in both areas are equally diverse and tend to be engaged in the same wide range of activities. This report shows that different urban geographies do shape the local nature of refugee entrepreneurial economies, but there are also remarkable similarities in the manner in which unconnected refugee entrepreneurs establish and grow their businesses in large cities and small provincial towns.