To Liberalise or Not to Libealise? A Review of the South African Government's Trade Policy

Trade policy is a central feature of the South African government's economic policy. In the early post-transition years it was widely debated. This debate is returning to centre stage as the government tackles a series of significant trade negotiations.At this time, it is necessary to be reminded of where South Africa stands on these issues, and to chart possible future directions. This paper is intended to be a small contribution to that process. Section Two assesses a stylised debate between 'free-traders' and 'protectionists'. It concludes that trade liberalisation is generally good for promoting competitiveness, which is essential in a globalising world. However, a caveat applies: limited time-bound protection may be appropriate under certain circumstances arising predominantly from issues of social harmony. Section Three assesses government's trade policy by analysing the perspective of the Department of Trade and Industry, the main formulator and implementer of trade policy in South Africa. It reviews the entire web of trade policy formulation, and synthesises recent evaluations of its impact. The concluding remarks summarise the central argument in light of South Africa's experience with trade policy. Essentially, it is argued that whilst significant liberalisation has taken place since 1994, there is scope to undertake substantial further liberalisation.

  • Authors: Peter Draper
  • Year: 2003
  • Organisation: SAIIA
  • Publisher: SAIIA
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