Cape Town - Economic Development Minister Ebrahim Patel has welcomed the R1bn of investment in South Africa to realise localisation as part of AB Inbev's offer to buy rival brewer SABMiller.
“This is the largest financial commitment yet by a company in merger proceedings and is about four times larger than the financial commitments imposed on Walmart by the Competition Appeal Court,” Patel said in a media briefing ahead of his budget vote on Thursday afternoon.
Of the R1bn investment, R610m will be used to support new emerging farmers and commercial farmers to enable South Africa to change from a net importer of hops to a net exporter of hops and value added malt.
As for the proposed Coca-Cola/SABMiller merger of three large South African soft-drink bottlers, Patel said government was concerned about job losses that could flow from the merger and practices that could close the market to smaller soft-drink producers.
Patel echoed the sentiments of Trade and Industry Minister Rob Davies that government will do all it can to protect the local steel industry. “But there’s a challenging balancing act: if you protect the upstream steel makers the price rises for downstream users,” Patel said.
“We’re trying to find a situation where we can support upstream businesses without imposing too onerous measures on downstream activities."