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Doing business in South Africa

Boere maak’n plan. This Afrikaans statement means “farmers make a plan”, and it refers to the South African ability to deal with any situation, no matter how difficult. South Africans are at their most creative and resourceful in the face of uncertainty. As a European and business woman in a corporate environment, I was taught in my past years to avoid situations with greater uncertainty, in personal and business life.

Here are some basic facts about South Africa:

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South Africa is a mixed bag of tough people who have faced difficult times – largely caused by others. The Dutch settlers escaped British domination by trekking into the interior in the mid-1880s. Indian, Chinese and Malay workers arrived in the 19th century, only to face racial discrimination. Throughout the country’s history, African peoples were dominated and exploited by whites. Later, the Germans, Austrians, and the Swiss entrepreneurs have long taken over South African’s tourism jewels – its vineyards, restaurants and safari lodges. Currently, German firms are among the most active corporates in South Africa growing energy sector. The fast developing country is also a huge temptation to run own business for many Europeans. All those South African historical battles between black and white, perpetrators and victims have made it strong but left the country with a weak side too. Many residents are deeply wounded with the past events and remain racially divided. This has a significant impact on doing business in South Africa, which is politically loaded. Foreign firms which have invested in the business in South Africa confirm that it is a lymphatic and dynamic market but it comes with a price: the fluctuating exchange rate, BBBEE regulations, which hand over control to a black partner, who would have decision making powers. BBBEE has in some cases increased racial tensions. It makes it hard for whites to find jobs, gain contracts or rise up the career ladder. And because firms must employ quotas of disadvantaged people in the same proportions found in the population, this has led to “token leaders”. Foreign firms often spend a high budget on trainings for their employees.

BUSINESS TIPS FOR SOUTH AFRICA

  • South African business culture is mainly Anglo-Saxon
  • The expression Make it now, is not understood in South Africa as “immediately” but “anytime from now”
  •  It’s never a good sign if you arrive too early, as people won’t be ready to meet you
  • South Africans are very friendly
  • South Africans might ask you very personal questions, which is normal for them
  • It is obligatory to help other relax by being friendly and helpful
  • South Africans usually get down to business quickly, which is a big contrast to Asian countries for example, where you have to spend some time to assure your business partners trust
  • As a foreigner, you won’t be treated well by South Africans, if you start giving them orders
  • Foreign firms are expected to give back to society
  • Be very careful with political correctness, especially when it comes to race and gender.

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