South African Trade Strategy: Rearranging the Deck Chairs?

This record of discussion from the South African Institute of International Affairs (SAIIA) examines the challenges and future directions of South Africa's trade strategy. The briefing covers the gridlock in the WTO Doha Round, the potential for unilateral trade liberalisation, the strategic value of Free Trade Agreements (FTAs), and the complexities of regional integration within SADC and SACU.

• The WTO Doha Round faced a breakdown primarily due to gridlock over agricultural issues, specifically the United States' domestic support and the European Union's tariff protection. The US had failed to commit to reducing domestic supports from $49 billion to $22 billion, while the EU's official tariff reduction offer stood at 39%, falling short of the G-20 proposal of 54%.
• South Africa's trade strategy is currently complicated by several factors, including the European Union's Economic Partnership Agreement initiative, institutional inertia within SACU, and domestic opposition to free trade talks with China and India.
• Empirical evidence from South Africa's liberalisation in the 1990s suggests that productivity improved drastically and the net effect on employment was neutral at worst. However, export performance has not met expectations because the primary challenge is domestic supply constraints rather than a lack of access to foreign markets.
• There is an argument for unilateral trade reform in South Africa to simplify and rationalise the tariff structure and reduce tariff peaks, as the current complexity increases the cost of doing business and final goods prices. This view cautions against 'strategic protection', which is cited as a major contributor to past economic inefficiencies.
• South Africa's existing FTAs, including the EU DCA, SADC FTA, and a deal with the European Free Trade Association, cover approximately 40% of its total goods trade. These agreements are noted for lacking coverage of services, investment, and intellectual property.
• Within the SADC region, SACU countries source only 17% of all imports from within SACU and 2% from the rest of SADC. While South Africa may not need the SADC Trade Protocol to expand its own regional trade, the protocol is viewed as necessary for opening the country to the rest of Africa to build the African Economic Community.

APA

South African Institute of International Affairs (2006). South African Trade Strategy: Rearranging the Deck Chairs? https://saiia.org.za/wp-content/uploads/2008/04/Record_SA-Strategy.pdf

Chicago

South African Institute of International Affairs. South African Trade Strategy: Rearranging the Deck Chairs? 2006. https://saiia.org.za/wp-content/uploads/2008/04/Record_SA-Strategy.pdf.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=South African Trade Strategy: Rearranging the Deck Chairs? |date=2 August 2006 |url=https://saiia.org.za/wp-content/uploads/2008/04/Record_SA-Strategy.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2006south, author = {{South African Institute of International Affairs}}, title = {{South African Trade Strategy: Rearranging the Deck Chairs?}}, institution = {South African Institute of International Affairs}, year = {2006}, month = aug, url = {https://saiia.org.za/wp-content/uploads/2008/04/Record_SA-Strategy.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }