South Africa says Wal-Mart could cost thousands of jobs

Wal-Mart's acquisition of South Africa's Massmart could lead to thousands of job losses and worsening labour conditions, the South African government will argue at a hearing that starts on Monday.

According to a study commissioned by South Africa's economic development and agricultural departments, if Massmart shifts 1% of its sales to imports from domestic suppliers, about 4,000 jobs could be lost.

The report, available on the website of South Africa's Competition Tribunal, is one of several statements to be delivered to the tribunal this week as part of a government hearing on Wal-Mart's $2.3 billion bid for 51% of the South African retailer.

Wal-Mart's entry into South Africa could also mean worsening working conditions at Massmart, according to the report.                                           

Wal-Mart has said it will honour Massmart's existing contracts with workers.

Competition authorities are the final hurdle for the deal, after shareholders voted overwhelmingly in favour of it.

The Competition Tribunal in March delayed the hearings to this week, to allow the government and unions more time to make submissions.

South Africa's trade minister said last week he wanted "concrete commitments" from Wal-Mart not to cut jobs.

South Africa has a history of blocking or imposing conditions on cross-border deals. In 2009 it blocked a $24 billion tie-up between telecom group MTN Group and India's Bharti Airtel, citing concern MTN could lose its national character.

More recently it allowed Japan's Kansai Paint to take over local paint firm Freeworld Coatings, but stipulated Kansai must sell a local unit, build a new plant and preserve jobs to secure the deal.

Wal-Mart, the world's biggest retailer, is aiming to make its largest overseas acquisition since it bought British supermarket chain Asda in 1999.

Some of South Africa's trade unions have threatened to strike against the US company if the acquisition goes through.