Essays on International Trade: Evolution of South Africa Trade Policy Case Study

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The paper 'International Trade: Evolution of South Africa Trade Policy" is a good example of a management case study. South Africa has changed its trade policies in a number of ways for almost twenty years. The economic growth rate of South Africa has been gradually increasing since 1990 when it was at 1% (Bahmani & Niroomand, 2008). An increase in export for the past two decades as identified by economists in the country is an indication that a tremendous increase in the economy can be realized. The dwindling economic growth in South Africa is as a result of various challenges faced by the government, for instance; global economic recession, widening trade deficit, inflation, increasing infrastructural demands with respect to maritime transport and socio-political crises in some of South Africa’ s trading partners like Zimbabwe and Kenya uncertainty (Bahmani, 2008). The report hereby shows an in-depth review of South Africa’ s trade policy for the last twenty years in conjunction with the evolution of tariff structure, and its effects on international trade. Evolution of South Africa’ s trade policy South Africa’ s trade policy has been changed and conducted at different levels since its independence in 1994.

The country has realigned its business environment by doing away with a duo exchange rate as well as improving the capital account. It also liberalized its trade regime in 1995 when it became a member of the World Trade Organization. This enabled South Africa to involve in international trade where the European Union and European Trade Association were its partners (Bhorat, 2008). Products for export in South Africa reduced due to the unilateral tariff reduction thus the country adopted the WTO compatible supply strategy that is still existing in both textile and motor vehicle industries.

The textile and clothing are subsidized by Textile Clothing Development Program (TCIDP). The TCIDP replaced the Duty Credit Certificate Scheme (DCCS) in 2006. The motor vehicle industry was under the Motor Industry Development Program (MIDP) which subsidized it to survive in the international market.

References

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Bahmani, M 2008, “Cointegration Approach to Estimate the Long-run Trade Elasticities in LDCs.” International Economic Journal, 12, 3: 89-96.

Bhorat, H 2008, “Income and price Elasticities in Manufactured Exports”. Working Paper 13, Development Policy Research Unit.

Bleaney, M 2009, “Trade reform, Macroeconomic Performance and Export Growth in Ten Latin American Countries, 1979-95.” Journal of International Trade and Economic Development, 8: 1, 89-105.

Edwards, L & Wilcox, O 2003, “Exchange Rate Depreciation and the Trade Balance in South Africa.” Prepared for South African National Treasury.

Edwards, L 2001, “Globalisation and the Skill Bias of Occupational Employment in South Africa.” South African Journal of Economics, 69, 1: 40-71.

Edwards, L 2005, “Has South Africa Liberalised its Trade?” South African Journal of Economics, 73, 4: 754-775.

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Edwards, L. & Golub, L 2004, “South Africa’s International Cost Competitiveness and Productivity in Manufacturing.” World Development, 32, 8: 1323-1339

Fedderke, J & Schaling, E 2005, “Modelling Inflation in South Africa: A Multivariate Cointegration Analysis.” South African Journal of Economics, 73, 1: 79-92.

Goldstein, M. & Khan, M.S 2005, “Income and Price Effects in Foreign Trade.” In Jones, R.W. and Kenen, P.B. (eds.) Handbook of International Economics, Vol. II.

Golub, S. 2000. “South Africa’s International Cost Competitiveness.” Paper presented at the TIPS annual forum, 18-20 September, 2000.

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