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Commerce and industry are beginning to feel the cost of the widespread violence against foreigners, with tourism likely to be first to feel the backlash.
Michael Tatalias, chief executive of the South African Tourism Services Association, said yesterday some "very panicky" overseas- based operators had expressed concern at the violence across Gauteng.
"It's the number three item on many TV news shows abroad, after the earthquake in China and the typhoon in Burma," he said.
"The pictures are very graphic. We've had no cancellations yet, but there's a lot of concern and worry."
Organisers of a conference of African businesswomen, which began in Cape Town at the weekend, said about 70 delegates, most of them from Nigeria and Burkina Faso, had stayed away because of the violence.
Madelein Mkunu, chief executive of the Leading Women of Africa group, said: "It's cost us about R100000 in cancellations."
She said 180 delegates from South Africa and other African nations had shown up despite the violence.
Tatalias said the government needed to take decisive action against the perpetrators if South Africa was to avoid the kind of tourism disaster that Kenya had experienced earlier this year due to election violence.
"We need to crack down on it with the full power of the state," he said.
Tatalias said the violence was a further threat to a tourism industry already suffering from the weakening rand and rising oil prices.
Officials at South African Chamber of Business and the Chamber of Mines said members had reported no major impact from the violence yet.
Joel Netshitenzhe, head of the government policy unit, said: "This is a flare-up that should be contained and not have an effect on major economic indicators."
Several businesses, which are owned by foreigners, shut their doors this week as the violence spreads from townships into business districts.
Che Wilson, a businessman in Randburg, Johannesburg, told the Sowetan yesterday that foreign business owners were living in fear for their lives and many were packing up and going back to their home countries. - Additional reporting by Lihle Z Mtshali