Fin24

Motlanthe: SA happy about Walmart deal

2011-11-02 17:11

Cape Town  - Deputy President Kgalema Motlanthe said on Wednesday the government is happy that US retail giant Walmart has chosen SA as an investment destination, and that it has made a comprehensive investment.

Answering a question in the National Assembly, Motlanthe said: "The point is that they have gone through everything. They have done a very thorough assessment, they have been through the Competition Tribunal and they were given the thumbs up.

"What they (Walmart) are saying is that all investors must come to SA. We agree (with Walmart) and are very happy that this is what they have done."

The question posed to Motlanthe was from Congress of the People MP Juli Kilian, who asked about the decline in foreign direct investment to the country which had fallen 70% from 2009 to 2010.

Kilian also pointed out that findings by the University of Johannesburg stated SA as a country now ranked 128th in in the world as an investment destination. Other countries similar to SA, such as Chile and Indonesia, ranked 19th and 20th respectively.

Jobs for poor

She also asked if Motlanthe agreed that sustainable jobs should be created for the poor.

Motlanthe agreed with the second part of Kilian's question, but when addressing the FDI issue he pulled out Walmart's investment.

He praised Walmart for its investment and for the fact that it had done a country assessment.

"This means that no other American company needs to do such an assessment," he said.

The deputy president made no mention that three cabinet ministers had instituted a court action to have stronger conditions set for the R16.5bn merger of Walmart with local retailer Massmart Holdings [JSE:MSM]

Minister of Economic Development Ebrahim Patel, Minister of Trade and Industry Rob Davies and Minister of Agriculture, Fisheries and Forestry Tina Joemat-Pettersson's joint application to the Competition Appeals Court was also in support of a trade union's demands to have the approval reversed.

In their court application, the three ministers have claimed that Walmart's entry would lead to a loss of manufacturing capability and threaten food security.

The Competition Appeals Court heard the case in October and is still to make a ruling.

Comments
  • No8 - 2011-11-02 17:30

    Motlhanthe for president!!!

  • africanwolf - 2011-11-02 17:36

    The only problem is the cheap Chinese imports if Walmart was supporting the local manufacturing sector then I don't have any problems

      Sterling Ferguson - 2011-11-03 00:23

      What has been missing in this discussion is Walmart can ship goods made in SA to the US stores. SA needs to establish closer ties with the US like China did to create jobs in SA. China is not going to open her market to goods made in SA. The only thing SA can sell to China is her raw materials. The so called left wing of the ANC are the ones that trying to steer SA away from trading with North America.

      Jakes - 2011-11-03 06:57

      Easy solution: Don't buy cheap Chinese imports. Difficult solution: In a poverty stricken country that is all some people can afford.

      PaulS - 2011-11-03 07:25

      80% of all products you buy today comes from China. This "cheap Chinese imports" are a hoax. You will be amazed if you see which of the products you think is LaLiDa products are manufactured in China. Even Apple is Made in China

      Phoenix - 2011-11-03 09:16

      "if Walmart was supporting the local manufacturing sector" Like what?

      Pietpetoors - 2011-11-03 09:23

      Most of the goods Game currently sell are Chinese imports anyway, so you won't even notice the difference. South Africa cannot manufacture anything anymore because we have minimum wages and trade unions which makes it impossible to manufacture goods at competitive prices. So we have no option than to import from China

  • eJay - 2011-11-02 17:42

    The thing is, once Walmart set their sights on Africa, not much would stop them. So, if they did not buy over massmart, they would probably have opened new shops right next to makro and the likes, and just underpriced them for a year or so to put them out of business.

  • Bill - 2011-11-02 21:01

    Maybe now cashiers in Game stores will greet their customers for a change and maybe even smile. Walmart don't play with employees that treat customers contemptuously and Game stores cashiers are the pits! Maybe we will even see correct barcode tags on the correct items now also! Viva Walmart…!

  • PaulS - 2011-11-03 07:29

    I cannot wait for Wallmart to take over. The service will improve and the prices will go down. We South Africans get screwed ten times over when it comes to prices. These retail stores make anything from 500 to 1000% profit on the goods they sell. We cannot afford to buy things because of the greed of the big companies. If Wallmart can better the prices and service, why not. It will benefit everybody. If they are hard on employees, GOOD for them . Our South African employes develop a bad attitude, that of "it is somebody's responsibility to make sure I have a job" and once they have the job they just have to be there they do not have to do anything for their pay because it "is the employers duty to pay them" and the employer cannot get rid of lazy inefficient employees. Cannot wait, we welcome you with open arms Wallmart

  • Sterling Ferguson - 2011-11-03 09:01

    @PaulS, the rand is over valued and this why the Chinese goods look cheap to South Africans.

  • Kevin - 2011-11-03 10:31

    Walmart suppliers will supply. Goddbye local factories and SA jobs

  • matsheletsa - 2011-11-03 11:12

    I like your attitude Mr Deputy President. We need FDI (like this one) in SA to stay competitive.Gud 1

      Old Realist - 2011-11-03 13:44

      I think you really did not read the report? Or maybe did not understand the questions asked and NOT answered? Motllanthe quotes Walmart as an example of successful FDI in the country when the country's own cabinet is fighting the decision!!! They want to set ridiculous conditions to the investment and all this will do is chase away other investors. I in fact know of one that is no longer going to invest purely on the basis of what the 3 stooges are doing now to challenge the takeover! He wasn't big but there goes another 20 or 30 jobs. We are ranked below Libya as an investment destination! Motlanthe is just another example of local politicians who really do not have a clue! What's worse is that he is disengenuous in his reply. He thinks we are all incredibly stupid. The real gain inWalmart is even if their competition only reduces prices by 0,1% - that means 30 million folk will pay 0,1% less and that outweighs many thousands of lost jobs.

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