Walmart decision: Important sign that SA is open for business and a boost to retail competition

The Democratic Alliance (DA) notes the Competition Tribunal's decision to approve Walmart's acquisition of Massmart. Sign-off by the Competition Tribunal indicates that this deal will help to promote much-needed competition in the retail sector - to the benefit of all South Africans experiencing the rising price of their basic necessities.

The approval of the deal also sends the signal that South Africa is open for business, despite the protectionist instincts of certain economic ministers. The DA believes that this deal will help to position South Africa as the foreign investment gateway into Africa - to the benefit of economic growth and job creation locally.

The DA remains concerned, however, about a new tendency in the Cabinet to use the competition authorities to fight battles that do not concern competition issues. The Competition Tribunal is tasked with policing market power abuses and monopoly formation, and with the promotion of healthy market competition in general, not with dictating labour policy. By introducing non-related issues into competition cases we risk watering down our ability to promote competition in our economy.

In addition, some players in the South African economy have assumed that Walmart will flout South Africa's labour laws. Our labour legislation has many unintended negative consequences, but important aspects of our laws protect workers' basic rights - which all role-players, including the DA, strongly support. Any business operating in South Africa will have to abide by these laws and to assume that a company will simply be allowed to break them is wrong. It is up to the government to welcome new investors into our economy - and then regulate them fairly and effectively.

Statement issued by Tim Harris MP, DA Shadow Minister of Trade and Industry, May 31 2011

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