No. 76: Refugee Entrepreneurial Economies in Urban South Africa

More than 60% of the world’s refugees now live in urban areas, according to the UNHCR. The social and economic impacts of refugee movements are therefore increasingly being felt in the towns and cities of host nations. The notion of “refugee economies” has been adopted to highlight the strong involvement of refugees in the many overlapping processes of production, consumption, exchange and entrepreneurship. As urban refugees increasingly become the norm in the urbanizing Global South, more research on the specifically urban economic impacts of protracted refugee situations is therefore urgently needed. Identifying the economic advantages and benefits associated with the presence of refugees is a key precondition for making governments more responsive to refugee needs and removing the barriers they face. South Africa has adopted a “self-settlement” approach to refugees. The country imposes no restrictions on freedom of movement and the geographical locations where refugees can reside. They are not confined to refugee camps or physically separated from citizens, which means they have direct interaction with South Africans. The self-settlement model emphasizes self-sufficiency on the part of refugees in the process of resettlement, with little assistance from state authorities. Many urban refugees are unable, for various reasons, to access formal employment in the cities and turn to the informal economy for their livelihoods. Because urban informality is generally invisible to policy-makers, scorned by politicians, and seen as a site of desperation rather than opportunity, its economic significance is often minimized. The primary aim of this report is to examine what we call “refugee entrepreneurial economies” in urban South Africa. Within the informal sector, refugee enclaves have often been viewed as stagnant pools of desperation, providing narrow opportunities and limited scope for advancement. But this is a misleading characterization. It is important to recognize the dynamism and growing complexity of South African refugee economies and to reshape our ideas about their positive economic impacts. In this report, we seek to broaden the image of refugees and their economic impacts beyond a narrow focus on their marginal status and vulnerability. They are viewed as dynamic agents with skills and capabilities who can play an integral role in transforming local settings and contributing to economic development. The report also addresses the question of whether geographical location makes a difference to the nature of refugee entrepreneurial economies by contrasting refugee enterprise in a major South African city (Cape Town) with that in several smaller towns in a different part of the country (Limpopo province). Cape Town was chosen as one of two study sites because there is a significant concentration of refugees in the city. In 2015, SAMP conducted surveys of migrant entrepreneurs in Cape Town and Johannesburg and found that in Cape Town, one-third of the respondents were refugees. In recent years, refugee entrepreneurs have also been establishing businesses in smaller urban areas around the country. In contrast to Cape Town, very little research exists on refugee livelihoods and entrepreneurship in Limpopo, which was chosen as the second site for this study. The study focused only on informal sector business owners who hold refugee (Section 24) permits under the Refugees Act. Holders of asylum-seeker (Section 22) permits were not included as many of these migrants are unlikely to be refugees, as conventionally defined. In Cape Town, 504 refugees were interviewed in 12 different areas of the city using a survey instrument first developed by SAMP for the Growing Informal Cities Project. A similar number were interviewed in Limpopo in the towns of Polokwane, Musina, Louis Trichardt, Thohoyandou, Burgersfort and Tzaneen. In each of the two study sites, a “control group” of 500 South Africans was interviewed (1,000 in total). The survey was complemented with 50 in-depth interviews with business owners in each research location and three focus groups with refugees in each location. The first section of the report compares refugee business owners in Cape Town and small-town Limpopo to ascertain if there are any significant differences in their respective socio-demographic and migration profiles: Male refugee entrepreneurs clearly dominate in both areas, with only 20-25% of business owners being women; The entrepreneurs in both locations tend to be relatively young with 80% in Cape Town and 77% in Limpopo under the age of 40. Very few entrepreneurs in either location were over the age of 50. There are marked idfferences in the countries of origin of refugee entrepreneurs. In Cape Town, the most numerous group was from Somalia. While there were some Somali-owned businesses in Limpopo and Ethiopian-owned businesses in Cape Town, the largest group in Limpopo towns was from Ethiopia. Some national groups were well represented in both places, including from the DRC and Zimbabwe. In both Cape Town and Limpopo, there were small numbers of refugees from the same countries, notably Burundi, Cameroon, Congo Brazzaville, Eritrea, Rwanda and Sudan. The majority of refugee business owners (over 90%0 arrived in South Africa after 2000. Limpopo has a slightly greater proportion of recent arrivals than Cape Town. In Limpopo, there is a clear time lag between year of migration to South Africa and year of arrival in the province. As many as 64% of the refugee entrepreneurs in Limpopo had lived in another South African town or city first (compared to only 27% in Cape Town). The major reason for relocation from large cities to small-town Limpopo is the pattern of violence against non-South African informal businesses. Experience of violent crime and fears over personal safety were recurrent motives for moving to Limpopo, which appears to be a safer haven and less inhospitable business environment than South Africa’s large cities. But while relocation to Limpopo may lessen the chances of victimization, it does not eliminate them. Many of the refugees interviewed in Limpopo told stories of being robbed and having their business premises destroyed. Police misconduct emerged as a greater problem for refugees in Limpopo. Despite being located in very different parts of South Africa, and nearly 2,000 km apart, the Cape Town and Limpopo refugee entrepreneurs engaged in a similarly wide range of economic activities. The vast majority in both locations are in the retail sector (75-79%), followed by services (25-28%) and manufacturing (4%-8%). The kinds of goods being sold and services offered are very similar as well. Among the sampled Limpopo refugee entrepreneurs, the most common items sold are clothing/footwear, confectionary, soft drinks, and toiletries/cosmetics. In Cape Town, the most common items sold are cigarettes, clothing/ footwear, personal accessories, and confectionary and beverages. Given the common perception among South African policy-makers that refugees and other migrants are driving South Africans out of business, it is of interest to see if they are selling the same kinds of goods. While no product category is the exclusive domain of either group, South Africans dominate the sale of fresh and cooked food and refugees are more likely to be selling footwear, personal accessories, electronics and household products. With regard to the business operations of refugees in the two locations, the main findings were as follows: The primary sources of business start-up capital in both areas were personal savings. Around 20% of both groups used loans from relatives, 12-14% loans from non-relatives and 12% gifts from relatives. Very few were able to access funding from banks, NGOs or the UNHCR. The main difference worth noting was that more entrepreneurs in Limpopo were able to access goods on credit with which to start their businesses. The most common strategies include bulk purchasing, extended hours of operation, keeping business records, negotiating prices with suppliers, allowing customers to buy goods on credit, and competitive prices. Refugees consult other entrepreneurs, suppliers and the media for information about the price of goods. There was very little difference in the frequency of use of business strategies by the two groups of refugees. Living in a large city does seem to provide more opportunity for buying in bulk, negotiating with suppliers and getting information on prices from other entrepreneurs. Almost a third of the Limpopo refugees travel to Johannesburg to purchase supplies, while most Cape Town refugees obtain their goods in the city. Although refugees in Limpopo are able to start a business with a smaller capital outlay than those in Cape Town, their enterprises are not as profitable. The Limpopo refugees earned less on average than their Cape Town counterparts: ZAR7,246 versus ZAR11,315 per month. In both Cape Town and Limpopo there are clear indications of increased business value with significant upward movement out of the lowest value category of less than ZAR5,000. The proportion of businesses in the ZAR50,000-plus value category increased from 27% to 47% in Cape Town and in Limpopo from 15% to 42%, suggesting that higher-value businesses may actually be performing better in Limpopo than in Cape Town. The establishment and growth of refugee businesses has economic spin-offs for a variety of South African stakeholders. The first beneficiaries are formal sector suppliers including wholesalers, supermarkets, fresh produce markets, retailers and manufacturers. Around two-thirds of the sampled refugees in both Cape Town and Limpopo purchase supplies from wholesalers, who are easily the largest beneficiaries of their patronage. Refugees in Cape Town are also more likely to patronize supermarkets and factories while those in Limpopo are more likely to patronize small shops. The average monthly spend at wholesalers was very similar in both Cape Town and Limpopo (ZAR35,000). The second major beneficiary of the activities of refugee entrepreneurs is the South African treasury. While most businesses operate in the informal sector and are too small to pay income tax, they pay VAT on most goods purchased from formal sector suppliers and do not claim rebates. Third, as these refugees noted, they pay heavy rents to South African property owners. While over half of both groups of refugees paid rent to a private South African owner, this was more common in Limpopo (almost 66%). The average monthly rentals were very similar: ZAR4,838 in Cape Town and ZAR4,555 in Limpopo. Fourth, the municipal government has a direct financial interest in its dealings with refugees. Particularly in Cape Town, refugees pay into municipal coffers through rent for business sites. This amounted to 22% of the refugee entrepreneurs compared with only 4% in Limpopo. These rents were higher in Cape Town, an average of ZAR879 per month compared to only ZAR311 per month in Limpopo. Also, as many as 28% of Limpopo-based refugees (and 21% of those in Cape Town) pay an annual licence fee to the municipality. The cost of a business licence is much higher in Cape Town at ZAR1,959 per year compared to ZAR752 per year in Limpopo. Fifth, refugee businesses in the informal economy create jobs. Around half (52%) of the Cape Town refugee entrepreneurs and just under half (45%) of the Limpopo entrepreneurs employ people in their businesses. The Cape Town and Limpopo entrepreneurs were equally likely to employ South Africans (around 50% of the total number of jobs created). While the Limpopo entrepreneurs favoured female employees (51% versus 45% of total employees), both groups preferred to hire South African women than men (with 65-70% of South African employees in both sites being female). Finally, it is clear from the accounts of refugees in both Cape Town and Limpopo that one of the primary beneficiaries of their activities in the informal economy is the South African consumer who can access goods and services much more cheaply than from formal sector suppliers. These include necessities such as cheaper food for the food insecure, luxuries such as household and personal products, and services such as panel-beating

Integration and onward migration of refugees in Scotland: preliminary evidence from the SUNRISE database

Despite the operation of UK dispersal policy for nearly a decade, there has been little examination of the resulting impacts upon refugee mobility and integration. Implemented under the 1999 Immigration and Asylum Act, the rationale behind UK dispersal was to 'spread the burden' (Robinson et al. 2003). The housing of asylum seekers to various locations across the UK was employed to discourage settlement in the South East (and particularly London) and distribute costs amongst UK local authorities. The main aim was to relieve housing and social pressures in South East England, where the majority of new arrivals spontaneously concentrated. By instituting a policy of compulsory dispersal, UK asylum policy has removed an asylum seeker's freedom to choose where to settle. This means that since 2000, the UK Home Office has implemented a policy of dispersal whereby asylum seekers are housed on a no choice basis to locations around the country. Asylum seekers in the UK are housed in various locations in England, Scotland and Wales. At the end of December 2006, the top three dispersal towns in England were Leeds, Birmingham and Manchester (Bennett et al. 2007). All asylum seekers fully supported by NASS and dispersed to Scotland are located in Glasgow City (5,010). In Glasgow, housing is provided for asylum seekers by Glasgow City Council as well as the YMCA. A small number of asylum seekers are located in Edinburgh (75) and supported on a subsistence only basis. In Scotland, and indeed within the UK as a whole, the largest concentration of asylum seekers is housed within Glasgow. Furthermore, there are an estimated 10,000 refugees and asylum seekers in Scotland which represent over 50 different nationalities (Charlaff et al. 2004). As a result the discussion focuses upon this local case study. Dispersal policy is one key element of UK asylum policy that determines the geographical distribution of asylum seekers across the country. But nearly a decade since the UK Home Office implemented dispersal policy, knowledge gaps still remain in understanding the onward migration decisions of refugees. Despite the clear aim of dispersal to determine local and national movements of asylum seekers, there has been surprisingly little attention paid to the role played by current UK dispersal policy in onward migration and integration. Policy driven research has tended to focus upon international and national issues to the exclusion of micro level processes (Bowes et al. 2009). Indeed, the majority of literature on dispersal has focused upon critiquing the policy for being driven by void housing and concentrating vulnerable populations in deprived, inner city neighbourhoods. With attention clearly focused upon critiquing dispersal policy, the potential long-term implications for refugee integration have been under-researched. The aim of this paper is to reassert the importance of considering mobility issues in refugee integration research. The current UK asylum policy environment is considered before attention turns to the theoretical developments in understanding refugee integration. Empirical evidence is presented from the Scottish Refugee Council's SUNRISE (Strategic Upgrade of National Refugee Integration Services programme) database to identify the geography of onward migration flows as well as the diversity of individuals engaged in movement around the UK during the asylum process as well as after being granted or refused status. The empirical material is employed to provoke questions of how onward migration may be linked to refugee integration. This includes considering factors which predispose individuals to migrate and how this may usefully provide insights into the process of refugee integration

No. 22: South African Government and Civil Society Responses to Zimbabwean Migration

This policy brief discusses a key paradox in relation to Zimbabwean migration into South Africa. While Zimbabwean migration since 2000 has been the largest concentrated flow in South African history, South Africa’s reaction to this movement has been characterised by the attempt to continue with ‘business as usual’ and ‘no crisis’ responses.1 Compared with most other developed and developing countries, where an inflow of tens or hundreds of thousands of people is usually treated as a political crisis, such a non-response to over a million immigrants requires explanation. The lack of commensurate responses is especially noticeable within the various departments of the South African government, but also within much of organised civil society. The scale and range of responses has addressed neither the scale nor the specific nature of Zimbabwean migration.2 In practice, therefore, addressing migrant needs and migration impacts is left to social networks among Zimbabweans, (often poor) South African citizens and local level public service providers such as local clinics. As a result of this fragmented and inadequate set of responses there are two major gaps: firstly between the needs of Zimbabwean migrants and the formal institutional frameworks and services provided to them, and secondly between the impacts of Zimbabwean migration on South African society and its ability to manage these impacts. There has been increasing documentation of Zimbabwean migrants’ welfare needs in South Africa (Bloch 2005; Zimbabwe Torture Victims Project 2005; Makina 2007; CoRMSA 2008; Human Rights Watch 2008). However, in parallel to the lack of coherent government and civil society responses to Zimbabwean migration, there has been a relative dearth of academic or think-tank documentation or analysis of these responses, and indeed of the implications of non-response for South Africa (Polzer 2008). Crucially, there has been no serious research on the dispersed and privatised responses by Zimbabwean networks and South African citizens, even though the aggregate impact of these actors is likely to be at least as significant, if not more so, than formal responses

No. 79: Rendering South Africa Undesirable: A Critique of Refugee and Informal Sector Policy

To understand the policy environment within which refugees establish and operate their enterprises in South Africa’s informal sector, this report brings together two streams of policy analysis. The first concerns the changing refugee policies and the erosion of the progressive approach that characterized the immediate post-apartheid period. The second concerns the informal sector policy, which oscillates between tolerance and attempted destruction at national and municipal levels. While there have been longstanding tensions between foreign and South African informal sector operators, an overtly anti-foreign migrant sentiment has increasingly been expressed in official policy and practice. This report describes the strategies being used to turn South Africa into an undesirable destination for refugees, including the setting up of additional procedural, administrative and logistical hurdles; the undercutting of court judgments affirming the right of asylum-seekers and refugees to employment and self-employment; ensuring that protection is always temporary by making it extremely difficult for refugees to progress to permanent residence and eventual citizenship; and restricting opportunities to pursue a livelihood in the informal sector. The authors conclude that the protection of refugee rights is likely to continue to depend on a cohort of non-governmental organizations prioritizing migrant livelihood rights and being willing and able to pursue time-consuming and costly litigation on their behalf

Home is Where the Heart Is? Forced Migration and Voluntary Return in Turkey's Kurdish Regions

What influences the decisions of internally displaced persons (IDPs) to return home after prolonged displacement? This article investigates the attitudes of victims of forced migration by analysing survey data on Kurdish displaced persons and returnees in Turkey. In an attempt to give a voice to displaced persons, we survey the conditions under which IDPs return home despite continuing tensions, lack of infrastructure and risk of renewed violence. The findings suggest that integration into a new environment in Western Turkey, measured by economic advancement and knowledge of Turkish, reduces the likelihood of return. Yet contrary to conventional wisdom, more educated IDPs demonstrate a stronger desire to return to their ancestral communities, suggesting that education increases available options for displaced persons. The findings are relevant in informing global responses to forced migration as well as understanding the local experiences and perceptions of IDPs in conflict ridden societies

The Institution of Gender-Based Asylum and Epistemic Injustice: A Structural Limit

One of the recent attempts to explore epistemic dimensions of forced displacement focuses on the institution of gender-based asylum and hopes to detect forms of epistemic injustice within assessments of gender related asylum applications. Following this attempt, I aim in this paper to demonstrate how the institution of gender-based asylum is structured to produce epistemic injustice at least in the forms of testimonial injustice and contributory injustice. This structural limit becomes visible when we realize how the institution of asylum is formed to provide legitimacy to the institutional comfort the respective migration courts and boards enjoy. This institutional comfort afforded to migration boards and courts by the existing asylum regimes in the current order of nation-states leads to a systemic prioritization of state actors’ epistemic resources rather than that of applicants, which, in turn, results in epistemic injustice and impacts the determination of applicants’ refugee status

The aspirations of Afghan unaccompanied refugee minors before departure and at arrival in the host country

This article explores the perspectives of Afghan unaccompanied refugee minors on their own motives and aspirations and on the motives and aspirations of their family and community context at the moment they left their home country and at arrival in the host country. Interviews and questionnaires were used to measure the aspirations of 52 Afghan unaccompanied refugee minors, soon after their arrival in Belgium. Aspirations at departure and evolutions in aspirations over time were examined retrospectively. Finding security and studying particularly influenced their decision to migrate. These aspirations changed over time under the impact of a diversity of factors, such as their own experiences and the opinions of others (e.g. peers, smugglers). Since motives and aspirations might influence the migration trajectories of unaccompanied refugee minors, migration policies and practitioners should take them actively into account so as to improve support for unaccompanied refugee minors

Sexual and Reproductive Health and Rights of Refugee Women in Europe: rights, policies, status and needs. Literature review

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