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International Relations for Growth and Development
Presentation to theJoint Budget Committee
03 November 2004
Overview of Presentation
• Strategic considerations
• Policy rationale
• Engagements on the continent
• NEPAD
• Negotiating agenda – post 2000
• Negotiating issues
• Challenges
• Conclusion
Strategic Considerations
• Creation of favourable economic conditions for advancing SA’s developmental objectives
• Recognition that globalisation is a force for SA to contend with
• Multilateralism, including WTO engagements, are appropriate for pursuing economic growth and development
Strategic Considerations (cont..)
• Need to work with other developing countries in the WTO to promote common objectives around market access for exports, economic development & constructing a global economic system that is balanced and responsive to developing country interests
• An appreciation of the fact that regional trading arrangements & free trade agreements can promote economic development and integration into the global economy
Policy Rationale
Contained in: • Global Economic Strategy 2001 – currently under
review• Integrated Manufacturing Strategy 2002
Objectives:• Promote domestic economic reform• Isolation to global integration/re-positioning• Enhance competitiveness
exports + industrial competitiveness• Export growth (market access)
Policy Rationale (cont…)
• Reduce high production costs
• Allocate resource more efficiently
• Reverse anti-export bias
• Diversify by market and product (value added)
• Create sustainable employment growth
Strategic overview of the Strategic overview of the continentcontinent
Need to foster deeper relations on a bilateral basis.
Focus on regional investment, infrastructure development, intra-regional trade.
Diversification and the production of value-added products.
Technology transfer and skills development.
Utilization of the NEPAD framework to attain set objectives.
Engagements on the continentEngagements on the continent
• Derives from the global economic strategy• Aligned to the NEPAD framework• Pursues a developmental agenda in Africa• Underpins the need for regional economic integration• Needs a strategy of engaging the multilateral institutions
that are dominant in the continent, e.g. World Bank, ADB,UNCTAD, etc
• Takes cognizance of exogenous factors• Focuses on intensive bilateral engagement on the
continent
Regional strategies (Africa)
• Over-arching strategy premised on regionally-focused (sub-) strategies:
Southern Africa Equatorial Africa, i.e West, Central and East North Africa and the Middle East
• Intensify mutually-beneficial bilaterals within regions• Forge and consolidate strategic alliances with
strategic countries
Regional strategies (Cont.) (Cont.)
• Economic development and integration
• Collaboration on cross-border projects e.g. SDI’s
• Develop financing instruments/institutions
• Build capacity
• Develop complementary industrial strategies
• Build and enhancing regional institutions
Negotiations: Post-2000
Rationale• Political and Strategic considerations
• Advance domestic trade reform (pace/sequencing)
• Further enhance competitiveness
• Build on previous negotiating outcomes (further negotiated market access)
• Threats to multilateralism
• Proliferation of FTAs (competitive position)
Negotiating Issues
All Negotiations contain:
Tariffs Agriculture/industrial
Standards SPS, TBT
NTBs Quotas, Rules of Origin, Customs
Remedies Safeguards, AD, countervail
Dispute Mechanism
ChallengesChallenges
• Market Access : external ( WTO) » internal ( Intra-Africa
• Trade Facilitation – export finance» Customs» Logistics» Ports and documentation» Standards» Export promotion
ChallengesChallenges
• Production – diversification,
» expansion and
» beneficiation
• Infrastructure : assist in identifying projects,
» Scoping the project
• Investment facilitation : access to finance,
» reduce risk for potential development
partners
• Economic governance – technical co-operation
• New areas – regulatory framework
Conclusion
Growth Employment SMME’s BEE Competitiveness
Geographic spread
Investment Exports Women
Empowerment