EAST LONDON The proposed free trade agreement between the US and the Southern African Customs Union (Sacu) could improve foreign companies' perceptions about the risk of investing in the region, said assistant US trade representative for Africa, Florie Liser, yesterday.

Liser, who is the chief negotiator in the free trade talks, was speaking at conference in East London yesterday.

The mooted agreement with the US has unnerved some SA companies who fear that it would leave the domestic market wide open to competition from powerful companies in the US.

Strongly advocating the potential benefits of the deal, Liser said Sacu companies would enjoy better access in the vast US market over competitors. The deal would also enhance regional economic integration and be a foundation for future economic growth.

"The agreement promises much for industrial development in SA and beyond," said Liser.

International investors could also view the region more favourably as a result of the free trade agreement with the US.

Liser said the message the US is sending is that "we believe there is tremendous potential in this region", that international investors were still nervous and cautious about the region.

Liser said while the region had done much work to attract investors, she pointed out five aspects that had to be in place to attract more investment.

These included adopting investment related agreements, like the proposed free trade agreement; addressing the lack of accurate business data; leveraging high profile success stories and educating potential investors about their country.

Trade and Industry Minister Alec Erwin's investment campaign in the US earlier this month was an example of this. "The other musthaves were creating the right investment climate and putting people first."

Liser said the US-Sacu agreement would be used as a model for possible similar agreements with West and East African country groupings.

May 30 2003 07:25:15:000AM Carli Lourens Business Day 1st Edition