Cape Times, March 31st 2006 -”Problems over permits deter foreign investors ”

Cape Town – The Durban Chamber of Commerce and Industry had temporarily stopped helping potential foreign investors to obtain work and residence permits because of objections from some of its members and obstruction from department of home affairs staff, Bonke Dumisa, the chief executive of the chamber, said yesterday.

Some members had pointed out that their business was to help intending investors to set up operations in this country and the chamber was competing with them. And some home affairs staff had been receiving “kick-backs” to issue permits, Dumisa said.

His remarks followed claims at a business forum held in Cape Town this week that South Africa was losing millions of rands worth of foreign investment because of the way would-be investors were treated.

Business people at the forum, which was organised by the department of trade and industry, complained about incompetence and obstructive behaviour by staff of the department of home affairs.

Leon Isaacson, of Aldes 21 Business Brokers, said individuals who wanted to invest sums ranging from R1 million to R10 million, and companies that intended to invest much more, were being misinformed by home affairs staff. They were given differing and misleading information about how to obtain permits, causing them to return to the department’s offices again and again until in some cases “they give up the idea of coming to South Africa”. One applicant was mistakenly advised to return to his home country and submit the application from there.

Isaacson said the situation had become so bad that his head office was advising brokers not to bother with would-be foreign buyers as permit difficulties led to many deals falling through. He queried why staff in offices in different cities could put their own interpretation on the Immigration Act.

Elsa Loggenberg, an immigration practitioner, said she was frequently required to queue for hours at a time and to return five or six times to submit an application.

Chris Watters, an immigration lawyer, said the Immigration Act was being rewritten and it was hoped that it would be replaced in July next year. But the department was not consulting with stakeholders and he feared this would “result in another shambolic act”.

The provision in the act for quotas of people with skills in short supply should be regarded as work in progress because there were some significant skills and qualifications that were not mentioned.

Watters said it was his view that the department was underfunded and was staffed by people with low morale who were undertrained and poorly paid but had power, which led to corruption.

An announcement that people found guilty of corruption would be dismissed had raised hopes that this situation would change, but it had been revealed that it had been “the minor bit players” who had lost their jobs for corruption.

Wilna Barnard, deputy director for investment promotion facilitation at the department of trade and industry, said it had senior staff who would give advice and help to intending investors. She said the department of home affairs usually issued permits on her department’s recommendation