SA restaurant industry faces collapse

There are growing expectations that President Cyril Ramaphosa may announce, in his state of the nation this week, that jobs in some sectors of the economy will soon be reserved exclusively for South Africans.

The possible exclusion of foreign nationals from some sectors of the economy was reportedly discussed by the African National Congress (ANC) and its  Congress of South African Trade Unions (Cosatu) and SA Communist Party partners in the tripartite alliance at a recent Lekgotla.

The possible move is said to be in an effort to reduce the country's record-high unemployment rate which now stands at 34.9%.

Analysts say barring foreign nationals from certain parts of the economy could diminish the general quality of jobs and exacerbate the shortage of skills in the country. Chief Economist at Econometrix, Azar Jamine says increased skills shortage will further undermine long-term economic growth and employment opportunities.

"As far as legislating to prevent foreigners from coming to work here. I think this stands to be very negatively received internationally. The fact is the country is very short on skills at the moment, and many of these skills can only be accommodated by encouraging foreigners to come with those requisite skills to come and take them up in the country."

Labour and mining analyst, Mmamogethi Molopyane says people are supposed to move around in a global economy as it makes for better economic activity and skills transfer.

"Certain sectors in manufacturing, even in mining, even in institutions of higher education, you see that some of the vacancies they're going to struggle to fill if they cannot find the skills, the knowledge, and the expertise here. And that is why I say it is going to be tricky. I think they are mentioning it so that it becomes a way of starting consultation, a way of starting debates."

Chief Economist at Efficient Group says excluding foreigners from some sectors of the economy could lead to turmoil in the services and tourism sectors which tend to employ a significant number of foreign nationals.

"That's a Xenophobic horrible idea. Imagine if the President announces that you can only employ South Africans in restaurants, and deport millions of Zimbabweans out of South Africa it will lead to horrible misery in Zimbabwe itself, it will lead to a collapse in the service industry like the restaurant industry in South Africa. The only reason why he would consider anything like this is to score some cheap political points."

Ramaphosa is also expected to discuss a way forward with regards to the national minimum wage, among other matters, when he delivers his state of the nation address on Thursday this week.