On 01 December Trade and Industry Minister Dr Rob Davies reiterated that there was no correlation between the Bilateral Investment Treaties (BITs) and attracting investments. He was speaking in Addis Ababa, Ethiopia where he was moderating the Africa Trade Week Panel Discussion on the Continental Free Trade Area (CFTA) and Foreign Investments Regulation for Africa
The panel noted that African investment regulation was marked by a myriad Bilateral Investment Treaties and Double Taxation Treaties that favoured foreign investors over their domestic counterparts. This session, therefore, considered how the proposed Pan-African Investment Code and the prospective African investment agreement in the CFTA could contribute to levelling the playing field and boosting intra-African investments for Africa's transformation agenda.
Minister Davies indicated that bilateral investment treaties did not necessarily translate into increased investment.
According to Minister Davies: “South Africa receives FDI from investors in countries with whom it has no BITs and often little or no FDI from others where a BIT was in place. After we cancelled our BIT with Germany, BMW announced its biggest investment in South Africa. What is important is that South Africa provides strong protection to investors in terms of the framework provided by the Constitution and other relevant legislation. Also, the rights of all investors are guaranteed in accordance with our Constitution.”
The minister added that in order to attract investment, African countries needed to identify and package investment opportunities, facilitate investment and provide for balanced protection to investors. He stated that Invest South Africa (ISA) had been established as a one-stop shop to assist investors in terms of identifying and assessing investment opportunities and to facilitate investment by improving the efficiency of regulatory processes. Minister Davies also emphasised the importance of targeted incentives to attract investments in certain sectors. It is important for Africa to develop a continental framework for investment that includes the facilitation of investment.