Abstract
M.Litt. et Phil.
The fundamental purpose of this dissertation is a descriptive analysis and theoretical
evaluation of the economic implications of the completion of the Uruguay Round of trade negotiations on South Africa's industrial and macro-economic performance. The study is an attempt to determine the impact of lower protection on the economy in general, which industrial sectors will gain/lose and how the anti-export bias inherent in South Africa's economy be influenced. A tariff is defined as a tax imposed on commodity imports. There are several types of tariffs, for instance ad valorem tariffs, specific tariffs and composite tariffs. The rationales for levying tariffs may be solely for raising revenue, in which case the home-produced product corresponding to the import would bear on equivalent compensatory tax. However, import duties are generally applied for the purpose of carrying out a particular economic policy, and in this context may be used to serve many functions, amongst others, the improvement of the terms of trade for the country levying the duty, strategic purposes and the protection of infant industries. The anti-export bias of 2,16 for total manufacturing shows the severe bias in South African policy in favour of inward industrialisation if export promotion policies are excluded from the calculations. Even the inclusion of GEIS does not bring about policy neutrality in terms of the inward and outward orientation. GEIS reduces the anti-export bias by approximately 33 percent for manufacturing from 2,16 to 1,44.
Summary Page xi Although the South African tariff structure is among the most complex in the world, the level of protection is not exceptionally high. The average statutory tariff in South Africa is 27,5 per cent, which is approximately equal to the mean for a sample of 32 developing countries for which comparable data exist. The implications of the Uruguay Round for South Africa are clear cut: the country will, as a contracting party to the GATT, have to adhere to the commitments stemming from the Uruguay Round in order to benefit from the more market-oriented international trading environment. The rationale for the overall structure of South Africa's GATT offer is the desire to encourage the manufacture of potentially competitive, higher value-added products, which are either consumer products or capital goods. Beyond this, the relative neutrality of
the offer is intended to encourage specialisation in fields in which South Africa has some comparative advantage. Although the GATT agreement will cause some casualties, notably in textiles, clothing and motor assembly, the economy as a whole will benefit from trade reform. The macro-economic success of trade reform should be evaluated in terms of how well the goals of reform have been attained and at what costs to the economy. Although some short term costs in terms of employment, balance of payments and income distribution could be of some concern in managing the policy changes facing South Africa, the overall findings indicate that the positive effects of the Marrakesh Agreement provide both constraints and opportunities for South Africa's effort to grow competitive industries.