Why xenophobia is bad for South African investments in Uganda

On first thought, perhaps the xenophobic attackers have for years been scared by frustration and hopelessness, failing to understand the impact of their action in an era where the world has become one village.
Whereas they might validate their attacks “there cannot be any justification for such actions (read attacking our brothers)”, President Jacob Zuma said in a televised speech viewed by millions across the world.
The attacks are a reminder of similar ones in 2008. However, the real concern is how such behaviour continues to grow given that every time they happen they have morphed both in scale and tactics.

At least, according to reports seven lives have been ended and more than 5,000 displaced in attacks sparked off by increased unemployment, poverty and hopelessness in a country of more than 48 million people.
Data from the government of South Africa indicate that more than 25 per cent of the country’s segment of productive people is not gainfully employed; however, independent sources put the figure at a much higher end.
Anyone who has been a guest in South Africa, cannot fail to notice the level of hopelessness that a section of people in Africa’s second largest economy have been driven into not considering that a few years ago the country’s iconic leader, Nelson Mandela had baptised it the ‘Rainbow Nation’.
In leafy suburbs such as Sandton in Johannesburg, desperate youth hold placards seeking for various forms of assistance ranging from money for something to eat to job placements.
Many of these have not had much education and they are a reflection and reminder of the eye soring poverty and desperation in shanty townships such as Soweto.
In fact, any guest in South Africa will never understand the sharp divide between the country’s poor and rich without visiting shanty townships littered across the county in the heart of Johannesburg and Cape Town, among others.

But what is at stake for South Africa?
For anyone at the heart of the South African government, this must be the hardest time to represent the country at any foreign forum, considering that the world now views the “Rainbow Nation” with twisted lenses.
The actions of a few criminal gangs have quickly, but steadily, undone the country’s image that has been built over decades as well as putting its global investments in a palisade.
As of December 2014, South Africa had a global Foreign Direct Investment portfolio of more than Shs532.5 trillion ($177.5b) spread across the globe, according to the CIA World Factbook.
Indeed, the above figure will make anyone understand why it is at this time that the county must engage a serious public relations campaign to redeem what has been lost in xenophobic attacks.

Bringing xenophobia closer
Here in Uganda, the South African High Commission last week commemorated the country’s 21 years of freedom and democracy with a cocktail.
But beyond the cocktail was an apology to particularly assure Ugandans that the attacks are isolated incidents masterminded by criminal gangs, which must be condemned universally.
Lekoa Solly Mollo, the incoming South Africa High Commissioner to Uganda clearly understands the gross impact of xenophobic attacks on the country’s investments and image that is why he had to suffice his tenure with an apology condemning actions of a few “criminal gangs”.
“As a nation committed to the foregoing prnciples, we are saddened by the recent spate of attacks on foreigners in our country. It is with deep sense of pain and regret that we humble ourselves and express our heartfelt apologies to the African continent in general and Uganda in particular for these unwarranted developments,” Mollo said in a veiled assurance that as a government they highly condemn the attacks.
Such an apology will not only calm tensions here, where the country has an investment portfolio in the excess of Shs18 trillion but will also provide a platform for South African companies to conduct their businesses since many people continue to wonder why it should be South Africa to promote xenophobia given the country’s history.

At stake here
In Uganda, South Africa has some of the largest investments in telecommunication, energy, banking, insurance and retail stores, among others
Maintaining the image of South African investment is a serious pointer that every individual involved in promoting xenophobic attacks must think of.
Below we profile some of South Africa’s large investments.

Stanbic Bank
Is Uganda’s largest commercial bank. As of December 2014, the bank had total assets valued at more than $1.26b, accounting for more than 19 per cent of the total bank assets in Uganda.
The bank is a subsidiary of the Standard Bank Group headquartered in Johannesburg, South Africa. It has 18 branches in Africa and affiliates in 21 other countries outside Africa.

MTN Uganda
MTN is Uganda’s largest telecommunications company with more than 10.5 million subscribers, according to Uganda Communications Commission.
The telecom firm, which is estimated to have a total asset base of more than Shs1.2 trillion, recently announced a profit of more than Shs299b for the year ending December 2014.
MTN leads in almost segments of telecom services including voice (calls), data (internet), and mobile money services among others.

Shoprite
The supermarket chain entered Uganda in 2008, opening its first store in downtown Kampala, around Clock Tower on Entebbe Road. However, the company has since grown its branch network to three with one located in Naalya Lugogo and Kampala outlet.

Game Stores
The supermarket has only one outlet in Lugogo, Kampala. It is an uptown store predominantly dealing in general merchandise and non-perishable groceries for home, leisure and business use.
Game is a subsidiary of Massmart Holdings, which is Africa’s third largest distributor of consumer goods.
The company opened its first outlet in Durban, South Africa, in 1970 with the desire to ease shopping which has then become tedious.

Woolworth
Is a subsidiary of Woolworth Holdings with headquarters in South Africa. The clothing line store, which launched in Uganda in the early 2000s, is owned under a joint venture with Tanzania businessman Ali Mufuruki, who owns the Uganda and Tanzania franchises.

Eskom
Is a subsidiary of Eskom Holdings, a South African government-owned power generation and distribution company.
The firm runs Nalubaale and Kiira dams, which contribute more than 40 per cent of installed power capacity in Uganda.

SAB Millers
Is the parent company of Nile Breweries Limited, which has significant control over Uganda spirits, beer and beverages market.

Sanlam Life Insurance
It is a subsidiary of Sanlam Group with headquarters in Bellville, South Africa. It is one of Uganda’s leading providers of life cover in Uganda.

CTM
The firm specifically deals in construction material; with specific focus on the ceramic tiles. It controls more than 40 per cent of the tiles market.

Bokomo
Is a poultry dealership selling broiler and layer chicks.

Additional reporting by Stephen Kafeero

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