§ Mr. Nichollsasked the Secretary of State for Trade and Industry if he will make a further statement on the voluntary ban on new investment in South Africa to which Her Majesty's Government agreed at the Commonwealth Heads of Government review meeting in August; and if he is taking any further action in this regard.
§ Mr. ChannonThe member states of the EC have agreed that the measure will cover new direct investment in the RSA by natural or legal persons resident in any member state. In accordance with this and our undertaking at the Commonwealth Heads of Government review meeting, the British Government are taking action to dissuade United Kingdom firms from making new, direct investments and to ask all the companies concerned to comply fully with this measure.
Under the terms of the intergovernmental decision agreed by the member states of the EC, new direct investment includes new acquisitions of share and loan capital of South African companies, and also includes loans and capital injections through inter-company and branch/head office accounts.
Financial transactions and hank lending in support of normal trading activity are not included. Also excluded are investments in training, health and social sectors in line with the positive measures agreed in the EC last year and this.
I believe that British industry, which has repeatedly supported calls for fundamental social and political reform in South Africa, is ready to play its part in helping to bring this about by non-violent means. Given the extent of existing United Kingdom investment in South Africa, wholehearted co-operation by British companies with the voluntary ban on new investment should have considerable impact.
Meanwhile, if the South African Government were to take those steps for which we and our partners have called, in order to establish a process of dialogue across racial lines, we have made clear in the Commonwealth communiqué that we stand ready to review and, if appropriate, to rescind the measures we have adopted.