Session 8: Agricultural value chains in the region
Fertiliser is a key input for commercial agriculture. However, there is generally low fertiliser use in Sub-Saharan Africa and hardly any production of fertiliser in countries in Southern and East Africa, aside from South Africa. Studies have emphasised the importance of transport costs in the price of fertiliser paid by the farmer as well as the detrimental impact of lack of competition in the trucking sector in increasing prices. Many reviews over the years have considered the various reasons for the high costs of road freight in southern and East Africa, including regulations restricting participation and competition, the role of national and regional transport associations, inefficient borders and poor roads, and lobbying and rent-seeking by powerful local transport interests. This paper considers the different reasons and their changing impact over time.
In this report we make an assessment of the transport sector in Botswana by analyzing policy and performance in the air and road transport sectors. The study had several other objectives among which was to identify reform needs for the two sectors, facilitate ease of comparison among SADC countries and assist policy makers identify possible areas for liberalization and harmonization of regional transport policies and strategies.
Among the several conclusions reached in the report is that the air transport sector is more tightly regulated than the road transport sector is. Air Botswana has finally become profitable. This makes the corporation well placed for good performance once it is privatized in 2003.Government responses to changes in transport technology and global trading regimes do occur, albeit at a slower pace as compared to the various challenges facing the industry. Some regulatory entities lag behind in terms of organizational capacity for their increased roles coming with increased liberalization. As pertains to the General Agreement on Trade in Services (GATS), it will make more sense for Botswana to make commitments in the air transport sector at a multilateral level. However, the country will stand to benefit more by concentrating on regional integration agreements when it comes to road transport since for reasons of physical proximity and economic interdependence it makes more sense to commit to regional integration agreements in road transport.
South Africa is a major sea trading nation with a relatively open economy that accounts for approximately six per cent of real world seatrade. This performance places South Africa within the top 12 international maritime trading nations. The literature reviewed clearly shows the importance of maritime transport costs and their ability to significantly impede international trade. South Africa's atypical increasing transport cost rate on imports is identified, along with some of the potential determinants. South African shipping policy is shown to be one of the most liberal maritime policy regimes in the world. Regulatory intervention is all but absent, although maritime fiscal policy is less favourable as the international policy environment has evolved to a point where South African shipowners and operators now compete internationally on an inequitable fiscal basis. South African ports policy is investigated with the focus on the changing tariff environment. In addition, some of the benefits and costs of the new tariff structure on cargo owners and ports are revealed.
This document has been prepared for the Trade and Industrial Policy Secretariat (TIPS) in light of the imperative for South Africa to prepare its negotiating mandate at the discussions around the World Trade Organisation's (WTO) General Agreement on Trade in Services (GATS) that commences in the year 2000. The GATS was negotiated during the Uruguay Round of multilateral trade negotiations under the General Agreement on Tariffs and Trade (GATT), and is one of the pillars of the agreement establishing the World Trade Organisation (WTO). This document contains the preliminary and independent results of an investigation into South Africa's trade in transport services . In light of the imperative to provide a sound and consistent negotiating base for the South African government the objectives of the present study were to: Identify the extent of the (potential) comparative advantage of South Africa in transport services particularly land and maritime transport services; Indicate how far the transport services sector (excluding aviation) can be liberalised (deregulated); Identify the possible impediments to the exports of transport services from South Africa. The document is structured as follows. In section two terminology is clarified and important concepts defined. In section 3 the context of liberalisation in services particularly transport services, is provided. Section 4 sets out the case for liberalisation in services and identifies the importance of transport services. In section 5 a brief overview is given of the global transport service market. Section 6 outlines the main features of transport service' s contribution to the South African economy. In section 7 the institutional and regulatory framework impacting on transport services in South Africa is discussed. In section 8 the burning issues in transport services for South Africa, namely regional integration, the 20-year strategy of the DOT (MSA) and the question of transport costs to and from South Africa is discussed. Section 9 concludes.