The Role of Trade in the Economy of South Africa

Since 1994 and the end of Apartheid regime in South Africa, This country has been rapidly integrated into the Global Economy. South Africa's trade and Industrial policy has been increasingly moving away from a highly protected economy toward an internationally competitive economy capitalizing on its comparative advantages. One of the major reasons behind this growing openness can be lifting of several sanctions and boycotts imposed by international society as a means to end apartheid.

South Africa is the second largest producer of Gold and is the world's largest producer of Chrome, Manganese and Platinum. Its is also one of the world's largest coal producers and has a large Agricultural sector.

Principal International trading partners of South Africa are African countries and countries like : Germany, the United States, China, Japan, Spain and the United Kingdom.

The gains from globalization are not equally distributed and whereas some industries and consumers have benefited from higher output or lower prices, others have lost out to more competitive foreign industries or lost their jobs. These trends are likely to continue. Tariffs and other forms of trade protection will come down, exports and imports will rise, and there will be further adjustment costs and benefits.

South Africa began an ambitious set of tariff and trade policy reforms in the mid-1990s. This included substantive multilateral liberalization through the WTO, the elimination of quotas and most import surcharges, the replacement of most formula, specific and mixed tariffs with ad valorem duties, and new bilateral agreements with the EU and South African Development Community  (SADC). The tariff structure has also been simplified through a substantial reduction in the number of tariff lines and some reduction in the number of rates levied.Almost 90% of South Africa's exports to rest of Africa go to the SADC economies. South African exports to the rest of Africa are predominantly of value-added goods. The country's investment stock in Africa has increased from Rand14.7 billion in 2001 to Rand121 billion in 2010, amounting to 21% of its total outward Foreign Direct Investment.

 As a member of the Southern African Development Community, South Africa has signed-up to an ambitious program of regional integration, which is supposed to culminate in the launch of a customs union by 2010 and a common monetary area just 6 years later. In addition, South Africa continues to grapple with implementation problems arising from the new SACU (Southern African Customs Union) Agreement and as a participant in the SADC Economic Partnership Agreement (EPA) block of countries, is also involved in complex bilateral negotiations with the EU. 

China-ASEAN Relations

The Association of Southeast Asian Nations, or ASEAN, was established on 8 August 1967 in Bangkok, Thailand, with the signing of the ASEAN Declaration (Bangkok Declaration) by the Founding Fathers of ASEAN, namely Indonesia, Malaysia, Philippines, Singapore and Thailand.

Brunei Darussalam then joined on 7 January 1984, Vietnam on 28 July 1995, Laos and Myanmar on 23 July 1997, and Cambodia on 30 April 1999, making up what is today the ten Member States of ASEAN.

As set out in the ASEAN Declaration, the aims and purposes of ASEAN are:

1. To accelerate the economic growth, social progress and cultural development in the region through joint endeavors in the spirit of equality and partnership in order to strengthen the foundation for a prosperous and peaceful community of Southeast Asian Nations;
2. To promote regional peace and stability through abiding respect for justice and the rule of law in the relationship among countries of the region and adherence to the principles of the United Nations Charter;
3. To promote active collaboration and mutual assistance on matters of common interest in the economic, social, cultural, technical, scientific and administrative fields;
4. To provide assistance to each other in the form of training and research facilities in the educational, professional, technical and administrative spheres;
5. To collaborate more effectively for the greater utilization of their agriculture and industries, the expansion of their trade, including the study of the problems of international commodity trade, the improvement of their transportation and communications facilities and the raising of the living standards of their people.
6. To promote Southeast Asian studies; and
7. To maintain close and beneficial cooperation with existing international and regional organizations with similar aims and purposes, and explore all avenues for even closer cooperation among themselves.

Since the Beginning of its activities, ASEAN has always been concerned about its relationship with two major Powers, the United States and China. Some members of ASEAN like Thailand and Philippines have traditionally been allies of the United States. Indonesia, Vietnam and Singapore have also supported the US while Laos, Cambodia and Myanmar are considered China's allies.

Because one of the major principles of ASEAN is "Neutrality" in their diplomatic relations with other nations and in order to eliminate the polarized environment within the ASEAN, the members have agreed to have an effective relationship with both China and the United States based on Neutrality and mutual respect. In fact, ASEAN members do not want to sacrifice their interest in siding with one of these two Super Powers in their struggle for power and influence in South East Asia. 

In the Case of China, because of China's strong presence in South East Asia, ASEAN has been tirelessly trying to improve their relationship with China through different Agreements. These Free Trade Agreements (FTA) have been signed by the trade authorities of both sided in order to remove trade barriers between ASEAN members and China. The FTA uniquely positions ASEAN countries to take advantage of China’s rapid growth. The rising middle class of China, with its high consumption pattern and future potential, provides ASEAN members with a market for its products and services. This market includes consumer electronics, food products, tourism, health and education services. China has already surpassed Japan as the largest consumer of luxury goods.

A more open and liberal regime of trade between the two is benefiting ASEAN’s rapid trade growth (26.4 percent per annum between 2003 and 2008), as well as greater inflows of investment into manufacturing and resource and energy-rich sectors. It has also increased access to the large consumer base in China. In the last few years, the strong trade growth between the two has propelled China to become ASEAN’s third largest trading partner, while ASEAN is well on its way to becoming China’s third largest trading partner in 2012.

International Sugar Agreement

International Sugar Agreement (ISA) is an agreement among sugar producing countries in order to stabilize world sugar prices and have cooperation in sugar production. Major sugar producing countries in the world that at the same time, the largest traditional consumers of sugar are :

• Brazil
• EU
• India
• China
• USA

Since 1953 there have been various attempts to raise and stabilize the global sugar price through this agreement. The latest agreement in 1977 established exports  quotas for its parties in order to withdraw sugar from the market when prices were low. like previous ones, this agreement ended in failure due to the fact that the European Union refused to sign the agreement.

The organization representing this agreement is called "International Sugar Organization" (ISO) which is an intergovernmental organization, based in London, United Kingdom. This Organization was established by the International Sugar Agreement of 1968, as the body responsible for administering the agreement.

The ISO has the role of promoting the sugar industry, particularly in developing countries, and improving the transparency of the market by publishing statistics on sugar production and trade and world market analysis.