South Africa not averse to bilateral investment treaties– Minister Davies
The Minister of Trade and Industry, Dr Rob Davies says South Africa is not averse to bilateral investment treaties. Minister Davies was speaking at a breakfast session hosted by the South African Chamber of Commerce and Industry at the Killarney Country Club in Johannesburg today.
“We have never said we were adverse to bilateral investment treaties. In fact, if there is a compelling economic or political reason why we need another bilateral investment treaty, we will consider it. But we will do so most likely within an alternative framework, which even the Europeans are talking about,” said Minister Davies.
Minister Davies, who was briefing business people on topical issues related to the mandate of the Department of Trade and Industry (the dti), including the Protection of Bilateral Investment Bill emphasised that there was no agenda to expropriate any foreign investment in South Africa.
“We have gone through the debate of nationalisation in this country, and it has been made clear that we do not have such a policy in South Africa. Even if someone wanted to nationalise, there is something called the property clause in our constitution, according to which investments are protected. One is entitled to an equitable compensation if there is an expropriation. It is not something that can be easily changed. In fact, we have substantial and real protection for all investments, domestic as well as foreign in the country’s constitution,” explained Minister Davies.
He added that the process of reviewing bilateral investment treaties was not peculiar to South Africa, as many countries in the world are conducting reviews.
“We have found that there is no correlation between the existence or non-existence of bilateral investment treaty and the flow of direct foreign investment. There are countries with whom we have bilateral treaties, but almost no investment. Conversely, there are countries we have no bilateral treaties with such as Japan. United States of America and India, but we have a significant flow of investment from those countries. Our investment sources are diversified,” said Minister Davies.
He explained that the South African government has taken the route of a law of general application that will apply to all foreign investments.
“The law provides for protection against expropriation based on the constitution. It guarantees national treatment and also provides a series of remedies including a service for amicable solution, access to the court, and the Arbitration Act,” stated Minister Davies.
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