The fable of SA’s special economic zones

The fable of SA’s special economic zones
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Wasted effort: The government’s reliance on the petrol and diesel vehicle export market now looks like a disastrous industrial policy, according to three economists. (Kevin Sutherland/Bloomberg/Getty Images) The Brazil, Russia, India, China and South Africa (Brics) bloc met late last year in Brasilia, just more than a year after the Forum on China-Africa Co-operation summit in Beijing. These two bodies are seeking to generate a new Global South-South development policy narrative, even though Brics host — Brazilian President Jair Bolsonaro — mimics United States President Donald Trump’s hostility to multilateralism, and China’s gross domestic product (GDP) growth and imports slowed to the lowest levels in 40 years. One thing all these institutions — plus the G20 countries — agree on: South Africa needs more special economic zones (SEZs), which grant generous subsidies to both Brics and Western corporations. The SEZ export fetish conforms to Finance Minister Tito Mboweni’s policy paper, Economic Transformation, Inclusive Growth, and Competitiveness. “Export orientation and sophistication are key drivers of long-run economic growth. South Africa needs to promote export competitiveness and actively pursue regional growth opportunities in order to leverage global and regional value chains for export growth. Technologically sophisticated exports, in particular, are crucial to structural transformation as they enable the economy to move from low- to high-productivity activities,” it reads. Yet when he addressed the ANC economic transformation committee in September, Mboweni could not supply concrete cases: “We need to promote exports because exporters grow faster, generate more jobs, pay better and innovate […]

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