http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 16.18Change: 0.01
R/$ = 14.14Change: 0.15
Au 1282.45 $/ozChange: 18.18
Pt 1072.50 $/ozChange: 26.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters About Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Aug 10, 2012

SA’s new investment policy to forge minerals, industrialisation link

Back
Africa|Health|Industrial|Massmart|Mining|Resources|SECURITY|Sustainable|Technology|Wal-Mart|Africa|Asia|Egypt|Libya|South Africa|USD|Products|Environmental|James Zhan|Rob Davies|Sub-Saharan Africa
Africa|Health|Industrial|Mining|Resources|SECURITY|Sustainable|Technology||Africa||||Products|Environmental||
africa-company|health|industrial|massmart|mining|resources|security|sustainable|technology|walmart|africa|asia|egypt|libya|south-africa|usd|products|environmental|james-zhan|rob-davies|subsaharan-africa



South Africa is crafting a “new gener-ation” investment policy framework, which will be underscored by the developmental needs of the country, especially the expansion of the country’s embattled productive sectors, Trade and Industry Minister Dr Rob Davies has revealed. A conscious effort would also be made to foster a direct link between an investor’s access to South Africa’s mineral resources and government’s ambition to support reindustrialisation.

Speaking at the launch of the United Nations Conference on Trade and Development’s (Unctad’s) ‘Investment Policy Framework for Sustainable Development’, or IPFSD, held at the University of the Witwatersrand, Davies said South Africa would refrain from entering into new bilateral investment treaties (BITs) until the new framework had been finalised. However, it would conclude BITs in cases of “compelling economic and political circumstances”.

A recent review of investment agreements signed since 1994 found the relationship between the agreements and foreign direct investment (FDI) to be “ambiguous at best”. It also found that some of the agreements posed risks, by limiting the ability of govern-ment to pursue its transformation agenda.

All these ‘first generation’ BITs were being reviewed with a view to termination, or possible renegotiation on the basis of a “new-model BIT to be developed”.

“South Africa’s updated approach would aim to achieve an appropriate balance between the rights and obligations of investors and the need to provide adequate protection for foreign investors, while ensuring that Constitutional obligations are upheld, and that government retains the policy space to regulate in the public interest.”

South Africa’s legislation in respect of the protection offered to foreign investors would be overhauled by codifying typical BIT provisions into domestic law, while clarifying their meaning in line with the Constitution.

“We would also seek to incorporate legitimate exceptions to investor protection where warranted by public policy consider-ations such as, for example, for national security, health and environmental reasons or for measures to address historical injustices and/or promote development,” Davies averred.

The inter-Ministerial committee dealing with investment, international relations and economic development would oversee all decision-making in respect of future investment deals.

New Framework The director of Unctad’s investment and enterprise division, Dr James Zhan, said a number of countries were undertaking similar exercises and expressed the hope that the IPFSD would offer a basis for greater global consensus on the matter.

The framework offered something of a middle way between the liberalisation of investment frameworks pursued during the 1990s and the move towards tighter regulation, pursued since the economic crisis of 2008.

Zhan indicated that the framework recognised the potential for FDI to support a country’s growth and development aspiration, but also created room for countries to pursue national policy choices, including active industrial policies.

Davies argued that South Africa and Africa were on the “cusp” of a new wave of investment, and that well-crafted investment policies were required to ensure that development flowed from such FDI.

South Africa recorded a sharp turnaround in FDI inflows during 2011, which rose to $5.8-billion, or 13.6% of Africa’s total, during the period. The rebound from $1.2-billion in 2010 was underpinned by Wal-Mart’s acquisition of a stake in Massmart, as well as mining-related corporate activity.

The performance of Africa’s largest economy also accentuated the recovery in the FDI inflows to sub-Saharan Africa as a region, which recovered from $29-billion in 2010 to $37-billion in 2011 – a level comparable with the 2008 peak. Meanwhile, inflows to Africa as a whole declined for the third successive year, to $42.7-billion from $43.1-billion in 2010. However, the decline was caused largely by the fall-off in investment to Egypt and Libya.

Unctad said the outlook for Africa was “promising”, owing to improved investor perceptions, which were driven by relatively strong growth, higher commodity prices and economic reforms.

Minerals Linked
Davies was particularly keen for Africa, or for the Southern African Development Community, to adopt a common investment framework in the area of natural resources. In light of commodity demand from emerging Asia, the Minister was of the view that there was potential for a new competitive advantage to be created around access to Africa’s mineral assets.

“South Africa needs to construct a com-petitive advantage for our own manufac- turing around access to mineral products. [But] that is going to require a policy intervention and it is here where the investment regime will prove important.”

South Africa was already pursuing this ambition on a bilateral basis, but “we will do better if we had a common understanding across Africa”.

The aim would be to capture investor commitments that went beyond technology transfer, skills development and competitive-ness improvements and which began to include stipulations on value addition.

“South Africa has to make the transition from being a producer and supplier of ‘dirt out of the ground’ to a producer and sup- plier of a higher level of beneficiated products,” he said, noting the material selling price differential between, for instance, mineral sands ($440/t) and titanium alloy ($100 000/t).

Edited by: Creamer Media Reporter

To subscribe email subscriptions@creamermedia.co.za or click here
To advertise email advertising@creamermedia.co.za or click here
 
Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other News This Week News
The two spent-fuel pools at Eskom’s 1 800 MW Koeberg nuclear power station, in the Western Cape, will be full by 2018, increasing the urgency on the State-owned utility to begin pursuing alternative storage options. Koeberg has, over the past 32 years, accumulated a...
South Africa lacks the skills necessary to implement the government’s plan to build 9.6 GWe of new nuclear energy capacity, warns nuclear-qualified Quality Strategies International CEO David Crawford. “Apart from the concern about the affordability of the programme,...
DOROS HADJIZENONOS The 700-series devices provide network security monitoring, app control, URL filtering, VPN security, antivirus, antispam, antibot, and advanced intrusion prevention and detection functionality
Cybersecurity multinational Check Point has released its latest 700-series cybersecurity systems for small businesses, which draw on its international threat intelligence to provide up-to-date cybersecurity, says Check Point South Africa country manager Doros...
More
 
 
Latest News
Mzwandile Masina
Updated 1 hour 2 minutes ago The Department of Trade and Industry (DTI) has invited companies to participate in a trade and investment mission to Ghana and Nigeria from August 8 to 12.   Companies in the agriculture and agroprocessing sectors, built environment professionals, automotive and...
Updated 1 hour 10 minutes ago Cabinet has approved the Industrial Policy Action Plan (Ipap) 2016/17 to 2018/19, which seeks to achieve a higher-impact industrial policy in difficult economic circumstances, including the difficulties faced by the domestic steel industry and the drought which has...
Updated 1 hour 22 minutes ago Multinational brewing and beverage company AB InBev has submitted an updated package of commitments to the European Commission (EC) in which it has offered to divest the entirety of JSE-listed SABMiller’s businesses in central and eastern Europe. This was in addition...
More
 
 
Recent Research Reports
Automotive 2016: A review of South Africa's automotive sector (PDF Report)
Creamer Media’s Automotive 2016 Report provides an overview of South Africa’s automotive industry over the past 12 months. The report provides insight into local demand and production, vehicle imports and exports, investment and competitiveness in the sector, as well...
Energy Roundup – April 2016 (PDF Report)
The April 2016 roundup covers activities across South Africa for March 2016 and includes details of a North Gauteng High Court Judge’s dismissal of a court application to postpone the 9.4% electricity tariff increase, which the National Energy Regulator of South...
Electricity 2016: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2016 report provides an overview of South Africa’s electricity sector, focusing on State-owned power utility Eskom and independent power producers, electricity planning, transmission, distribution and the theft thereof, besides other issues.
Energy Roundup – March 2016 (PDF Report)
The March 2016 roundup covers activities across South Africa for February 2016 and includes details of the Department of Energy’s plans to announce the preferred bidders for the first tranche of the coal independent power producer procurement programme; the Council...
Steel 2016: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2016 Report examines South Africa’s steel industry over the past 12 months. The report provides insight into the global steel market and and particularly into South South Africa’s steel sector, including production and consumption, main...
Construction 2016: A review of South Africa's construction industry (PDF Report)
Creamer Media’s Construction 2016 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; key participants; local demand; geographic diversification; corporate activity; black economic...
 
 
 
 
 
This Week's Magazine
The two spent-fuel pools at Eskom’s 1 800 MW Koeberg nuclear power station, in the Western Cape, will be full by 2018, increasing the urgency on the State-owned utility to begin pursuing alternative storage options. Koeberg has, over the past 32 years, accumulated a...
South Africa lacks the skills necessary to implement the government’s plan to build 9.6 GWe of new nuclear energy capacity, warns nuclear-qualified Quality Strategies International CEO David Crawford. “Apart from the concern about the affordability of the programme,...
DOROS HADJIZENONOS The 700-series devices provide network security monitoring, app control, URL filtering, VPN security, antivirus, antispam, antibot, and advanced intrusion prevention and detection functionality
Cybersecurity multinational Check Point has released its latest 700-series cybersecurity systems for small businesses, which draw on its international threat intelligence to provide up-to-date cybersecurity, says Check Point South Africa country manager Doros...
Daimler Trucks and Buses Southern Africa (DTBSA) saw a marked slip in new-vehicle sales in 2015 compared with 2014, with sales dropping from 5 897 units to 5 300 units. The decline came as the South African new truck and bus market declined from 31 558 units in 2014...
Group of 20 (G-20) economies threatened to penalise havens that don’t share information on their banking clients after the leak of the Panama Papers provoked a global uproar over tax evasion. The G-20 will consider “defensive measures” against financial centers and...
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $149 Close
Subscribe Now for $149