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Call for MPs to have say in foreign trade deals

BusinessDay | 5 May 2010

Call for MPs to have say in foreign trade deals


Parliament’s trade and industry committee wants MPs to play a greater role in negotiating international agreements and has urged that the legislative framework and rules for dealing with them be reviewed.

Currently, Parliament merely ratifies agreements which have already been signed by the participating countries and has no say in deciding their terms and conditions. A recent example was the bilateral investment treaty between SA and Zimbabwe which some MPs — particularly from opposition parties — believed did not go far enough in protecting South African investments.

In its report on the hearings it conducted on the trade and industry budget vote, the committee said resources should be allocated to allow it to participate in negotiations and for committee members to accompany trade negotiators as observers during negotiations on major agreements.

The report also called on the Department of Trade and Industry to submit, within six months, a skills audit related to the key action programmes outlined in the industrial policy action plan, as it feared that a shortage of technical skills could inhibit the implementation of the plan.

The department would also have to report on proposed measures to address the negative effect of cartels on consumers and small- and medium-sized enterprises (SMMEs) and investigate the effect of insufficient development finance and capital investment on addressing structural unemployment.

Development finance institutions, such as the Industrial Development Corporation, would be required to submit a report to the committee on the availability of capital to promote new growth industries and to identify any possible constraints to providing support to SMMEs and co-operatives.

The committee identified the availability of affordable development finance as a “key constraint to future economic development”.

“The policy for the capitalisation of development finance institutions must be reviewed to increase the availability of capital finance.

“Furthermore, the self-financing model that has been adopted previously has led to a divergence from a developmental approach to financing with development finance institutions operating similarly to commercial banks,” the report said.

 source: BusinessDay