6 November 2019
South Africa to host a Diplomatic Conference for the Adoption of a Protocol that will create an International Legal Framework for the Financing of Mining, Agricultural and Construction (MAC) Equipment, 11 – 22 November 2019
South Africa, in collaboration with the International Institute for the Unification of Private Law (UNIDROIT), will host a Diplomatic Conference to adopt an international treaty aimed at facilitating the financing of MAC equipment. The Diplomatic Conference will be held at the OR Tambo Building of the Department of International Relations and Cooperation over a two-week period from 11 to 22 November 2019.
All member states of the United Nations have been invited to the Diplomatic Conference and it is expected that more than 200 delegates representing their governments as well as observer international organisations will be attending the Diplomatic Conference.
By hosting this Diplomatic Conference, South Africa will build on its legacy when it hosted a very successful Diplomatic Conference that adopted the UNIDROIT Convention on International Interests in Mobile Equipment (Cape Town Convention) in 2001 which has, in addition to its Aircraft Protocol, become two of the most successful international commercial law treaties ever. The MAC Protocol will be the fourth protocol under the Cape Town Convention, and it was preceded by the aircraft, rail and space protocols.
The MAC Protocol will extend the international legal framework regulating security interests in certain types of high-value equipment. This is to improve access to credit for domestic industries of the parties that was established by the Cape Town Convention to the mining, agriculture, construction, and related financing, manufacturing, exporting and importing industries with a much greater potential to make a positive economic impact on South Africa.
An independent economic assessment, commissioned by UNIDROIT, released in August 2018, indicates that the MAC Protocol holds great promise for countries eager to expand their MAC and related financing, leasing, importing and exporting sectors. Estimates of the global positive economic impact on Gross Domestic Product point to US$30 billion per year.
The economic assessment points out that the MAC Protocol may increase the stock of MAC equipment in developing countries by US$90 billion over a 10-year period. If it is considered that the MAC Protocol uses asset-based financing principles and enables private-sector financing to be obtained without further government guarantees, and may make private-sector finance available in areas where the Government has been the only source of financing, it is clear that the MAC Protocol is not only attractive to the emerging and established miner, farmer or construction contractor, but also to governments who are hard-pressed to stay within budget.
The MAC Protocol can support the South African Government’s Medium Term Strategic Framework targets and the National Development Plan that focus on economic development, land reform, infrastructure investment, job creation and general economic growth. It will also be able to accelerate the African vision of continental free trade and economic development.
Enquiries: Mr Clayson Monyela, Spokesperson for DIRCO, 082 884 5974
ISSUED BY THE DEPARTMENT OF INTERNATIONAL RELATIONS AND COOPERATION
OR Tambo Building
460 Soutpansberg Road