By Simon Nare
Following a spate of food poisoning incidents in Gauteng involving children, economic development MEC Lebogang Maile has announced a multi-disciplinary task team to crack down on illegal spaza shops not towing the line.
Maile told reporters on Sunday that it was concerning that the township economy was being monopolised by foreign nationals who owned spaza shops, which were historically run by locals.
“This is occurring in a context where the South African economy has hurled millions of people, particularly those in townships and other historically disadvantaged areas, at the margins of economic activity.
“But it is not a new development. In fact, the situation has been ongoing for over a decade,” he said.
Maile said that a study by the Sustainable Livelihoods Foundation found that more than 50% of spaza were run by foreign nationals between 2010 and 2013.
“The foundation also found that in Delft, outside Cape Town, 70% of South African operated shops closed down over a 14-month period, leaving local shopkeepers outnumbered three to one. Various other studies have corroborated the fact that foreign nationals dominate the spaza shop industry in townships across South Africa,” he said.
Speaking to Inside Politics, Maile said that despite these statistics, the government was not calling for foreign-owned shops to banned.
Instead, there were laws in the country that needed to be followed.
Maile said local shop owners were unable to thrive in their own communities.
“These constraints include a cost-of-living challenge that has eroded disposable incomes for local households, lack of access to credit and funding instruments for small and micro enterprises from major funding institutions as well as lack of access to markets.
“This has given foreign shop owners the edge as foreign spaza shops are often owned through shareholding agreements, which allow for a bigger start-up investment than the average investment by locals,” he explained.
Also, Maile said foreign nationals had the upper hand because they bought in bulk and could offer competitive prices.
They also often extended credit and offered goods in flexible quantities.
“These are factors that must be appreciated in the discourse on why local spaza shops struggle to compete. In recognising these factors, it is also important that as a responsible government we also safeguard the economic interests of South African citizens in this volatile global economic environment,” the MEC said.
“This requires much-needed public-private partnerships to support local entrepreneurs and enterprises to thrive and become competitive. The existing programmes must be widened, and the only way to achieve this is through greater investment,” he said.
Maile said as part of the provincial government’s interventions, mechanisms have been instituted to facilitate public awareness campaigns on consumer education.
He said the department had partnered with the United Soweto Township Economy Forum to help with the campaign.
Dozens of children have fallen sick throughout the province, and six friends recently died in Naledi, Soweto, after eating chips from a spaza shop.
Over the weekend, foreign-owned spaza shops shut their door in Sharpeville fearing for the lives.
There have been a number of protests and looting around Gauteng’s townships, with residents blaming foreign nationals for the food poisonings.
INSIDE POLITICS
