Perspectives on Trade, Investment and Competition Policy in South Africa

The document analyzes the nexus of trade, investment, and competition policy in South Africa, highlighting the shift from early trade liberalization to a more cautious approach centered on employment creation. It details the role of the Competition Act of 1998 in addressing public interest and the complexities of managing foreign direct investment (FDI), illustrated by the Walmart-Massmart merger. The author argues that a robust competition regime is essential to maximize the benefits of FDI and ensure market efficiency while adhering to international obligations.

• South Africa's trade policy shifted from a bold liberalization strategy after 1994 to a more cautious approach by the late 1990s due to the severe impact of import competition on industries like clothing and textiles, leading to significant job losses.
• The 2010 trade policy and strategy framework prioritizes industrial policy, specifically the manufacturing sector, using import tariffs as a selective tool for protecting industries and supporting job creation rather than as a primary revenue source.
• The Competition Act No 89 of 1998 established an independent three-agency architecture—the Competition Commission, the Competition Tribunal, and the Competition Appeal Court—to replace the less robust and politically dependent 1979 regime.
• South African competition law is distinctive for explicitly incorporating 'public interest' considerations, allowing authorities to evaluate the impact of mergers and business practices on employment, small businesses, and historically disadvantaged persons.
• The Walmart-Massmart merger highlighted the tension between domestic public interest goals and international trade obligations under the WTO, specifically regarding national treatment and market access in the retail sector.
• The Competition Tribunal conditionally approved the Walmart-Massmart merger on 31 May 2011, imposing conditions such as a two-year ban on retrenchments and the creation of a ZAR 100 million development fund for local suppliers.
• While South Africa views foreign direct investment (FDI) as crucial for productivity and growth, net FDI inflows have trended downward since the 2008 resource boom, although the total inward FDI stock grew to $132.4 million by 2010.
• Between 2005 and 2011, South Africa received more than twice as many greenfield investments as cross-border mergers and acquisitions (M&As), which is viewed positively as greenfield projects typically raise fewer concerns regarding host economy impact.
• South Africa generally resists including 'new generation' trade issues—such as competition and investment policy—in regional trade agreements, preferring to focus on trade in goods.

APA

Hartzenberg, T. (2012). Perspectives on Trade, Investment and Competition Policy in South Africa. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2012/03/Occasional-Paper-111.pdf

Chicago

Hartzenberg, Trudi. Perspectives on Trade, Investment and Competition Policy in South Africa. South African Institute of International Affairs, 2012. https://saiia.org.za/wp-content/uploads/2012/03/Occasional-Paper-111.pdf.

Wikipedia

{{cite report |last1=Hartzenberg |first1=Trudi |title=Perspectives on Trade, Investment and Competition Policy in South Africa |publisher=South African Institute of International Affairs |date=March 2012 |url=https://saiia.org.za/wp-content/uploads/2012/03/Occasional-Paper-111.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{hartzenberg2012perspectives, author = {Hartzenberg, Trudi}, title = {{Perspectives on Trade, Investment and Competition Policy in South Africa}}, institution = {South African Institute of International Affairs}, year = {2012}, month = mar, url = {https://saiia.org.za/wp-content/uploads/2012/03/Occasional-Paper-111.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }