Tata may lead drive out of SA due to onerous visa rules

September 14, 2015, 8:53am
Image: tatamotors.com

Tata may lead drive out of SA due to onerous visa rules

MUMBAI — SA’s visa and work permit policies could be undermining its aim to be the headquarters base for multinationals wanting to expand their operations into Africa.

This conclusion can be drawn from the experience of Tata International, a subsidiary of the Indian industrial conglomerate Tata Sons. It has decided to base some of its key personnel in Tanzania because of the long delay in getting visas and work permits for its senior managers in SA. In the past, the company ran all its African operations from its Johannesburg head office.

The government has put in place a number of tax and other incentives to encourage multinationals to locate their African headquarters in SA. It is facing strong competition from Mauritius, which has a generous tax regime. SA’s government can ill afford to shoot itself in the foot with onerous visa regulations for corporate personnel.

New visa regulations for tourists have had a damping effect on tourist numbers and are hurting the industry.

Tata International MD Noel Tata told a delegation of African journalists at the Tata group’s headquarters in Mumbai on Friday that it took up to six months to obtain visa and work permits for its senior managers, strategic planners and financial managers. The problem first emerged about a year ago.

"We are finding it increasingly time consuming to get visas for our managers. We believe that for a supervisory business across Africa, we ought to be granted faster, quicker and more employment visas to enable us to grow the business the way we should," he said.

The company wanted the flexibility to transfer its staff within the company.

Mr Tata said it was too early to say whether the company — which employs about 40 people at its headquarters in Johannesburg — would reconsider moving its African headquarters out of SA entirely.

Tata International moved its African head office from Zambia to Johannesburg in 1995 shortly after the installation of the new government.

It derives $373m of its total annual revenue of $2.2bn from its African operations which are located in 14 countries in sub-Saharan Africa.

Mr Tata said Tata International believed it could double its revenue from Africa over the next five years.

Tata is a global trading and distribution company that is involved in motor vehicles, metal trading, importing thermal coal into India, exporting leather and leather products from India, and agri-products.

Linda Ensor: BDLive