Visa chaos blamed for billions lost to South Africa
Dr Leon Schreiber, Minister of Home Affairs
Image: Ayanda Ndamane | Independent Newspapers
For years South Africa’s broken visa system, slow border processing, and paper-based bureaucracy have effectively cost the country billions and blocked investment.
This is according to Home Affairs Minister Leon Schreiber.
“I would go so far as saying that they constitute a non-tariff barrier to investment in our country.”
Experts have warned that South Africa risks a multiplier effect on export volumes to the US, given that the 30% tariff is higher than that of rival exporters, making local products less competitive in the American market.
Donald MacKay, CEO of XA Global Trade Advisors, has said tariffs affect about 1.3% of South Africa’s gross domestic product.
The minister was speaking at the 12th edition of The European House – Ambrosetti CEO Dialogue on Southern Africa, held on the sidelines of the G20.
Schreiber said the Home Affairs ecosystem forms “the foundation of the state in any country”.
Yet, Schreiber said these institutions had for years been plagued by inefficiency.
“For many years, this ecosystem was associated with inefficiency, corruption, long queues, and paper-based manual systems.”
The minister linked these failures directly to the economy, highlighting lost tourism, blocked skills, and financial-sector fraud.
“Tourism was held back from key markets like China and India, primarily because of visa inefficiencies,” said Schreiber.
Schreiber added that “companies… struggled to attract critical skills, even though a study from the National Treasury identified this issue as the second biggest impediment to economic growth in our country after loan sharing”.
In addition, key issues identified by the Financial Action Tast Force when it placed South Africa on the greylist also plagued the country.
“Fraud and identity theft, particularly in the financial sector, costs the country billions,” said the minister.
Deputy Minister of the Department of International Relations and Cooperation, Alvin Botes, has said that Illicit Financial Flows – theft – is robbing South Africa of a massive $3.5 billion every year.
Schreiber added that slow processing at land borders and illicit trade robed South Africa of desperately needed tax revenue and holds back regional trade.
“These are all examples of critical economic issues that have a direct impact on South Africa's attractiveness as an investment destination.”
The department is now implementing new solutions to reverse the damage.
Visa reforms are also targeting corporate investment and skills shortages.
“Through regulatory change, we've already introduced the points-based system for world visa adjudication last year, which has created a more transparent and predictable system,” said Schreiber.
The creative sector, hit by visa unpredictability, now benefits from the Screen Talent and Global Entertainment Scheme (STAGES).
“In one case, a R400 million Netflix project left South Africa behind, even though we were the preferred destination, and they went to Mexico instead because they couldn't get visas,” said Schreiber.
As a result, Schreiber said the department has “now launched… STAGES… to obtain their required documents within 24 hours.”
Schreiber said all these changes are part of a broader strategy to bring Home Affairs services to citizens efficiently.
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