Migrants are good for economic growth and job creation – Standard Bank CEO

Standard Bank CEO Sim Tshabalala believes that migration is positive for growth, while its effects on local workers are usually small and often positive. Picture: Steven Ferdman/Getty Images Standard Bank CEO Sim Tshabalala made bold remarks at a seminar hosted by the Kgalema Motlanthe Foundation about the role that migrants play. Unlike many people who have viewed the matter pessimistically, Tshabalala said migrants usually play an important role in the country’s economy.

His comments come at a time when South Africans are protesting against the high number of illegal migrants in the country. Tshabalala’s address at the dinner focused on the link between migration and financial services. “Migration and financial services are linked through remittances, transaction accounts, foreign exchange, mobile wallets, cash-out networks, merchant payments, and the broader task of moving money safely, cheaply and lawfully across borders,” said Tshabalala.

“To put it simply: people move; money moves; and – crucially – support for families and for businesses is created.” He noted that from a financial sector perspective, there are three major economic and commercial issues closely related to migration, and even more significant than remittance flows. These are the effects of migrants on their host economies; the effects of the politics of migration on multinational corporations and on each host country’s economies more broadly; and openness in general to flows of ideas, goods, capital and people. Tshabalala highlighted that one of the recurring claims in anti-migrant politics is that foreigners take jobs, lower wages and contribute little to their host society.

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“These claims are, quite simply, contrary to the evidence,” he said. “Yes, rapid migration – like rapid changes in trade patterns – can cause economic costs and social distress in particular places and industries. And a capable government needs to manage and mitigate those local costs. “But, overall, migration is good for growth, and good for job creation.” He noted that economists have never claimed that migration imposes no adjustment costs.

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