Examining South Africa’s trade with the Southern African Development Community (SADC) with the SADC Free Trade Area initiative in place
Part of : MIBES Transactions : international journal ; Vol.7, pages 63-78
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Pages:
63-78
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Abstract:
This paper examines South Africa’s trade with SADC given that the SADC FTA is now in place. Trade intensity indexes were calculated and evidence shows that while South Africa trades intensively with other regional groupings in Africa, non-SACU SADC is its most important trading partner. Significant increases in South Africa’s imports from non-SACU SADC coincided with the years it zero rated its products in various product categories. In examining the factor intensities of products traded, evidence shows that South Africa’s major imports from non-SACU SADC are mainly mineral fuels, non-primary commodities, and resource-intensive manufactures, while its major exports to non-SACU SADC are mainly technology-intensive manufactures. This reflects disparities in levels of industrial development between South Africa and non-SACU SADC. In examining whether other regional groupings in Africa have been able to displace non-SACU SADC as South Africa’s major trading partner, evidence shows that while the groupings have made efforts to gain some ground over non-SACU SADC, these efforts have not been sustained, with South Africa trading mostly with non-SACU SADC.
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Keywords:
trade intensity index, factor intensity of products, Southern African Development Community, Southern Africa Customs Union, East African Community, Economic Community for West African States
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