Violence harms South African economy

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Scott Jagow: Yesterday, South Africa’s president called recent violence in his country, a “disgrace.” He said the government would take swift action. At least 50 immigrants have been killed. Thousands of people have fled their homes.

Some of those arrested in this violence blame immigrants for taking their jobs. Neighboring countries are worried about how this might affect Africa’s biggest economy. Gretchen Wilson reports from Johannesburg.

Gretchen Wilson: At the end of apartheid, South Africa became known as the “Rainbow Nation,” and one of its colors was green. Its economy’s grown steadily since 1998. GDP climbed nearly 6 percent last year.

Geoff Rothschild is with the Johannesburg Stock Exchange:

Geoff Rothschild:
We expect the growth to remain positive. And that is a draw card. Investors want to invest where there is going to be growth, where there are opportunities.

But those opportunities may shrink if the violence drives away the immigrant population that helps to fuel this economy.

Forty percent of skilled mine workers here come from neighboring countries, such as Malawi and Mozambique. And while the country’s biggest mining companies say it’s been business as usual, three gold mining firms last week reported production problems because some workers didn’t punch in.

And the head of South Africa’s mine workers’ union said there’s been no exodus of skilled miners. But analysts say investors are reassessing the nation’s risk.

In Johannesburg, I’m Gretchen Wilson for Marketplace.

All reporting by Gretchen L. Wilson, © 2008

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