Fin24

D-day for govt appeal on Massmart case

2011-10-20 07:41

Johannesburg - An appeal by the government for a review of the Massmart Holdings [JSE:MSM] Walmart merger is expected to be heard on Thursday.

Earlier this month, four departments - agriculture, forestry and fisheries; economic development; and trade and industry - filed their heads of argument in the Walmart Massmart merger case.

They argued that Walmart's acquisition of Massmart can have a "potentially devastating" effect on local jobs.

They want transaction to be sent back to the Competition Tribunal for proper consideration and more effective conditions to be imposed.

The government has argued that the merging parties will increase imports, relying on Walmart's vast and extensive international procurement capability.

Economic Development Minister Ebrahim Patel raised concern that tens of thousands of jobs could be lost in the local factories that currently supply Massmart and other local retailers.

Trade and Industry Minister Rob Davies said there was no evidence that Massmart would create 15 000 because of the merger, as it had advertised.

Agriculture Minister Tina Joemat-Pettersson said the implications of a displacement of local suppliers by Massmart would result in lost income and most likely the loss of jobs.

The three departments had asked the court to send the matter back to the Competition Tribunal for a more considered evaluation based on adequate information from the merger parties with a view to much stronger conditions being imposed.

 

Comments
  • RentBoy - 2011-10-20 08:14

    Fo once Ebrahim Patel could be right!! Wallmart is an outlet for Chinese goods and care not a "jot" for local manufacturers if they cannot be cheaper than the Chinese.

      mickh - 2011-10-20 08:51

      That is very strange, I have bought lots of American made goods at Walmart in California. But of course it is usually the people without the experience that have the most to say.

  • Terry - 2011-10-20 08:23

    What message does this send out to potential investors from abroad? You know what. Stay away from this crazy country, that's what. People would have to work for a change and not cower behind their unions. Thats what they do in 1st world countries. If I were Walmart I would can the deal immediately and walk away as fast as I could.

  • Zoolie - 2011-10-20 08:52

    Goverment only wants to know how much they can take out of the cookie jarr, @Rentboy, have you not seen in who`s bed our goverment is, The CHINESE my china.

  • muhhamedvefa.dag - 2011-10-20 11:00

    They are going to destroy small business and local manufacturer.

  • Zain - 2011-10-20 12:24

    No they will create something every South African needs, a shop where items are not sold at 300% of its cost. The labour rules in South Africa have destroyed many jobs, allowing cheap chinese goods has destroyed the manufacturing sector. If jobs are lost it will be because they clean out the people who sit around and do nothing all day and yet expect a wage, in south africa people need to learn that if you want a salary you need to work for it. The government wasted R21 billion this year, that could have sent thousands of people to school, university and provided free skills training. I think this is a good move and support it 100%. Julius Malema has scared off most of the foreign companies, If we want to develop our country we need foreign investors that dont try and bully us into who we can and cannot allow in our country. Walmart you have my vote!

  • will294 - 2011-10-20 12:37

    I would be a bit more sympathetic to our local entrepreneurs iff they didn't rip us off at every opportunity. Just obtained a printer cartridge for my printer in Hong Kong at R900 (local price R1,400!). DVD of a popular series R140 in the UK - R385 here!!). The list kust goes on and on. The locals don't deserve any protection

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