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Labour laws 'not cause of economic ills'

Sep 04 2012 09:54 Sapa

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Cape Town - The Marikana shooting gave the lie to the argument that relaxed labour laws were the answer to South Africa's economic problems, Trade and Industry Minister Rob Davies said on Monday.

"I think in the light of Marikana, it might give rise to a little bit of reflection from those who have seen the magic bullet and the solution of all South Africa's woes as being a weakening of the rights of workers and a weakened trade union organisation.

"I think some critical reflection by those who have been advancing those propositions is probably warranted in the light of what happened there," Davies said.

He made the remarks in a briefing on the upcoming International Small Business Congress, and rejected notions that the labour law regime was the biggest obstacle encountered by entrepreneurs in South Africa.

"I don't think, from our side, we think that the biggest or most important concerns are about labour legislation's impact on small businesses."

Davies confirmed he would use a trip to London later this week to reassure investors that South Africa remained a viable destination in the wake of the violent confrontation at Lonmin's platinum mine in Marikana.

"The message would be from our side that there has not been up to now a more generalised negative reaction which is affecting the FDI (foreign direct investment) pipeline, or a more negative reaction across markets as a whole.

"There are a particular set of challenges in Lonmin, and a particular set of challenges perhaps which is reaching into other parts of the platinum mining industry," he said.

"A lot of those issues are the subjects that will be dealt with by the judicial commission of inquiry, as well as by the inter-ministerial task team."

Davies said he would hold talks with United Kingdom Business Secretary Vincent Cable, and meet with investors and investment analysts.

The small business congress is taking place in Sandton, Johannesburg, from September 15 to 18.

Davies said South Africa hoped to learn from other countries how the government could improve its small, medium and micro enterprise support policies, as these had not achieved the desired result.

"We have not achieved the impact in terms of small business development that we wanted to achieve."

The government had identified the so-called incubation programmes as the most successful of its small business initiatives, but could not mentor enough small companies in this way fast enough, he said.

It would therefore call on the private sector to help sponsor the programmes.

Davies said China was sending one of the biggest delegations to the conference and had indicated that representatives would remain in the country afterwards to meet directly with small South African companies.

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