Business expansion has occurred despite the prime obligation of the entrepreneurs to support family still in crisis-ridden Zimbabwe. Instead of reinvesting all of the business profits into further expansion, a portion is therefore diverted into remittance channels to Zimbabwe. Over one-third of the entrepreneurs remit funds to Zimbabwe at least once a month and as many as three quarters send remittances to Zimbabwe at least once per month and a few times per year (Figure 13). Only 12% never send remittances. The entrepreneurs remit an average of ZAR 8,473 (586 EUR) per annum. However, there were significant differences in remitting volume between the two cities, with those based in Cape Town sending an average ZAR 10,217 (707 EUR) per annum to Zimbabwe compared to an average ZAR 7,326 (501 EUR) per annum for those in Johannesburg. 0 10 20 30 40 50 60 70 P er ce nta g e (%)
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Figure 13: Frequency of Sending Remittances to Zimbabwe
Although not explicitly canvassed in either the SAMP survey or the MICIC interviews, informal Zimbabwean remittance couriers (omalayisha) have established themselves as a major conduit for remitting to Zimbabwe.118 Informal money operators such as the omalayisha command about 20% of the market share of remitting by these entrepreneurs (Figure 14). Traditionally, many migrants have also taken remittances on their own trips back to Zimbabwe or sent them with friends.119 However, Zimbabwean entrepreneurs in South Africa cannot afford to return home that frequently and other formal channels (especially money-transfer companies) have now entered the market. There is a significant difference between Johannesburg and Cape Town-based entrepreneurs with regard to other channels. Probably because of the distances and costs involved, those in Cape Town are less likely to take the funds themselves and send them with friends or co-workers, and more likely to use the money transfer companies and banks.
118
Thebe, V. (2010); Thebe, V. (2015).
119
Tevera, D. and Chikanda, A. (2009).
0 10 20 30 40 50 60 At least once a month
A few times a year Once a year Occasionally (less than once a year)
Never Don't know
Pe rc en ta g e (% )
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Figure 14: Money Transfer Channels Used by Migrant Entrepreneurs
Symptomatic of the high levels of food insecurity under crisis conditions in Zimbabwe, most of the migrant entrepreneurs send funds for food purchase by the household (Table 16). Other major uses including non-food household expenses, school fees, clothing and medical costs. There appears to be very little investment of remittances in any kind of productive revenue-generating activity in Zimbabwe, a finding consistent with research on remittance usage in general.120
Table 16: Reasons for Remitting to Zimbabwe
Total % Cape Town % Johannesburg % Buy food 77.2 78.7 76.1
Meet other day to day household expenses 46.4 75.0 27.0 Pay educational/school fees 44.2 57.4 35.2
Buy clothes 34.1 41.7 28.9
Pay medical expenses 23.2 35.2 15.1 Build, maintain or renovate dwelling 19.9 19.4 20.1 For special events, e.g. weddings/funerals 18.0 26.9 11.9 Pay transportation costs 10.1 11.1 9.4 For savings/investment 7.9 4.6 10.1
Buy property 6.7 6.5 6.9
For agricultural inputs/ equipment 6.0 6.5 5.7
Note: Multiple response question
Several additional insights into the remitting behaviour of Zimbabwean migrant entrepreneurs came from the in-depth interviews in Cape Town, Johannesburg and Polokwane:
The majority of the interviewees said they remit funds regularly to family members still in Zimbabwe and that these remittances are critical to their survival;
In a few cases, especially where most, or all, of the immediate family members have joined the migrant in South Africa, remitting amounts and frequency have tailed off or
120
Tevera, D., Crush, J. and Chikanda, A. (2010).
0,0 5,0 10,0 15,0 20,0 25,0 30,0 35,0 40,0
Through a bank I take it myself With family, friend or co- worker Formal money transfer agency (e.g. Western Union, Money Gram Informal money transfer P er ce nta g e (%)
40
ceased altogether. This is consistent with a pattern first observed by Crush et al. and Makina and Masenge that as migrants become more established in South Africa remitting tends to decrease;121
A number of interviewees mentioned the increasing difficulties of remitting goods – including foodstuffs – to Zimbabwe (which is probably related to the Zimbabwean government’s new restrictions on imports) and were now mostly sending cash;
Running a business in South Africa on a continuous basis means that personal conveyance of remittances is not especially common. The omalayisha remain relatively popular but a new remittance channel is also making its presence felt. Web-based electronic money transfer companies were mentioned by a number of interviewees as the easiest way to send funds. The two most used are Mukuru and Ecocash;122
The obligation to remit is heightened by the crisis conditions in Zimbabwe but also means less capital to reinvest in business expansion in South Africa. As one entrepreneur in Johannesburg observed:
“All the money that I get just goes straight to support my children. There is no surplus to put in the bank or to save for something big. What makes it even worse is being a single mother. When you are husband and wife and you both work, at least you can plan and try to save money for bigger things. Right now all I get is waiting to go somewhere; there are school fees, rent, uniforms, food, clothing and other necessities. I cannot even save from January to December and get something like ZAR 5,000 [346 EUR] to start something better.” (Johannesburg Interview No. 1)
121
Crush, J., Chikanda, A. and Tawodzera, G. (2015b). The Third Wave: Mixed Migration from Zimbabwe to South Africa. Canadian Journal of African Studies 49: 363-382; Makina, D. and Masenge, A. (2015).
122