2020 is nearly over – hallelujah!
It is the time of the year which calls for a brief review of 2020 and peek into what to expect in 2021 . What a year this was, I am certain all of you will concur? Like most of our readers, I personally can do without a repetition of this experience ever again!
During the early stages of the lockdown, I was surprised and shocked at the severity, the hostility of government against businesses and the total lack of discussion around limiting ones freedom, that continued for weeks
Sure, it was all new, but the response from government was very hostile and authoritarian.
Many programs of support were introduced by the government supposedly to assist businesses, but in my opinion the only one that worked was TERS and that only with significant delays.
It is a fact that our non South African staff have to date, either not been paid or with significant delays of months, compared to the payments to South African citizens.
Then one should not forget the following:
- The massive fraud by our own politicians when considering Health Department tenders in various provinces.
- The reluctance of the public sector to return to work.
- The overprotective trade unions with retrenchments.
- The general lack of urgency to open the economy
In my opinion, these actions have caused irreparable damage to the economy that caused many businesses to close. The overall effect of these closures will probably only be seen next year.
What is clear is that state finances, already in a dismal state, have deteriorated further and our finance minister has a near impossible task of boosting the economy ahead of him.
The most recent downgrades by the rating agencies will the country closer to a potential sovereign debt default.
On the positive side, the government is finally starting to tackle corruption. Government agencies have issued warrants of arrests and investigations are taking place and yielding results. The convictions are yet to happen but we are certainly moving in the right direction.
What has become clear is the depth of the state corruption. The aforementioned issues have led to a wave of emigration to countries that offer better prospects for South Africans. This loss in revenue and skills will only damage the economy further. South Africa also avoided the collapse of its’ healthcare system witnessed in other countries across the globe. There are various contributing factors but the outcome remains impressive although there are reports that a second wave might hit us in January. Fingers crossed our healthcare system will remain resilient and herd immunity will prevail until a vaccine is available.
We truly hope that the borders remain open for tourists and family members. Both my brother and his family and my parents have postponed their intended visit twice. It would really be great to welcome them soon.
At IBN, despite all the challenges during the year and this year was financially very challenging, the team is stronger than ever. It is important to take care of your employees in difficult times and this has been rewarded with good overall staff morale. We also successfully assisted our a first batch of clients with immigrating to Mauritius.
The real question for me is what multinational companies will be doing about international assignments to South Africa for 2021. A few of our American clients are reluctant to initiate international assignments for early next year and with a stagnant economy less expats will be coming to South Africa.
I am very hopeful that our new office in Mozambique will be successful in 2021. We have already secured a couple of local and international clients and will be using the expertise of our team in South Africa and locally in Maputo to assist them with compliance and the issue of permits. The Mozambique authorities have become very strict with foreign workers and compliance.
How will the legislation governing immigration change in 2021? I for see the critical skills list will be amended in the first quarter of 2021. I hope that South Africa will introduce a long–term visitor’s visa attracting digital nomads and other financially independent freelancers to South Africa.
Mauritius recently introduced a similar long–term visa and it is already a huge success. As mentioned in a previous newsletter, I hope South Africa considers third–party funding for business visas and introduces a residence by investment category visa.
We also expect that DHA will resume accepting applications for permanent residence from January 2021.
Personally, my wish for 2021 is an improved sleep pattern and some international travel. I am determined to continue learning Spanish, something I started during lockdown. Lastly, I really hope that my family and I will get the chance to cycle through Vietnam at the end of 2021.
We would like to thank our clients for their continued support and wish all our readers a safe, joyous and a well deserved break over the festive season.
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By Andreas Krensel