THE state is continuing to seek ways of ameliorating possible future job losses which may or may not result from Walmart’s investment in Massmart.
It would like the R100m set aside for this purpose increased to R300m. This newspaper has in the past questioned the wisdom of the state taking its own regulatory authority to court because this will make South Africa even less of a global destination for real investment.
But there is a secondary effect which this tinkering will cause — the distortion of the business environment for retail.
Just last month Pick n Pay — a direct competitor of Walmart’s — announced it was cutting 3000 jobs without a murmur of dissent from government.
There was no demand for the creation of a fund to ameliorate the results of this decision. Apparently job shedding by wholesome South African companies is not frowned on by the anti-imperialist lobby.
What this in effect means is that Walmart is paying a penalty for a possible future transgression while actual job-shedding goes unpunished.
No company should make a decision to shed jobs lightly and the state is entitled to ask serious questions when thousands are to lose their jobs.
But legislating against this or imposing fines in anticipation of it happening is not the way forward. All this does is make South Africa’s labour market less competitive, causing us to lose out on the jobs that further foreign investment would bring.
Distorting the market with piecemeal interventions smacks of ignorance and arrogance.
*This is a draft leader for the Sunday Times