Abstract:
The International Energy Agency stated in its World Energy Outlook 2012 that global conventional crude oil production peaked in 2008. Total world oil exports have been stagnant since 2005 as oil exporting countries consume more of their own output and some battle against depletion. Unconventional oil production is growing, but the economic and environmental costs are large and the net energy return is very low. The Middle East North Africa region, home to the largest share of remaining oil reserves, is in political turmoil, threatening disruptions to oil supplies.
Within this context, oil importing countries such as South Africa need to prepare for oil price and supply shocks. This Development Dialogue will interrogate research being undertaken for the UK Department for International Development on "oil shock mitigation strategies for developing countries", with SA as a case study. The focus includes preparations for both short-term oil shocks (precipitated for example by geopolitical or extreme weather events) and long- term strategies to ensure energy and specifically liquid fuel supply security in a context of global oil depletion, declining world oil exports, falling energy return on investment, and increasing oil price volatility. This Dialogue is of relevance to not only to the energy sector, but also to transport, macro-economics, trade and industry, and agriculture.
About the speakers
Jeremy Wakeford: Dr Jeremy Wakeford is an economist specialising in energy and sustainability. He is a Senior Lecturer Extra- Ordinary in the School of Public Leadership at Stellenbosch University and consults to government departments, private sector clients and NGOs. He is currently leading a research project developing 'oil shock mitigation strategies for developing countries', commissioned by the UK's Department for International Development.
Bongani Motsa: Mr Bongani Motsa is a macro-economist specialist at the Department of Energy. He is part of the team that is developing the Integrated Energy Plan (IEP) for South Africa. Prior to joining the Department, he worked on African economic integration for Trade and Industrial Policy Strategies (TIPS). He holds a Master's degree in economics (majoring in econometrics) from the University of Pretoria.
Abstract
Using data from two surveys evaluating South Africa's investment climate that were administered by the World Bank, I found evidence suggesting that there exists a relationship between perceptions of managers with regard to labour regulations and firm performance. Firms whose managers perceived labour regulations to be burdensome performed worse than other firms. They grew more slowly and were less likely to invest their profits in the establishment than other firms.
There is also evidence suggesting that where firms perceive labour regulations to be burdensome, they will substitute away from the conventional employment contract (regular or permanent contract) towards more atypical employment contracts (temporary or part-time contracts) which have a lower regulatory burden. There is evidence that also suggests firms are not limited in their ability to substitute towards this atypical employment despite limits imposed by South Africa's labour legislation. I found no evidence to suggest that firms who find labour regulations to be burdensome will choose to substitute away from labour towards capital.
About the Speaker
Dinga Fatman is an economist at TIPS. He joined TIPS in 2011 to provide research assistance in the industrial development pillar. He is in the process of completing his Master's degree in Economics at the University of KwaZulu-Natal. His Masters dissertation topic was entitled: “Labour Regulations and Firm Performance in South Africa”. Dinga's general research interests involve South Africa's investment climate issues.
Stephen Timm is a South African policy researcher and journalist who has written on small business and entrepreneurship for almost 10 years. Between 2003 and 2010 he wrote for Big news, a free sheet newspaper aimed at small business owners. He has since also written on small business for a number of other business publications, including Business Day, Business Report and Entrepreneur magazine. He currently writes for the government's news agency BuaNews, where he reports from Parliament. He has also travelled to four emerging countries in the last two years to research programmes and policies that the South African government can learn from to bolster support to small enterprises. Earlier this year he presented a research report, funded by the Department of Trade and Industry and economic think-tank Trade and Industrial Policy Strategies (TIPS) on what South Africa can learn from Chile and Malaysia to boost support to small businesses. The report was a follow up to a research report he presented last year for TIPS titled, How to boost support from small business: Lessons from Brazil and India. Timm also won the Africa SMME Award for Journalist of the year in 2005. He has a higher diploma in journalism from Rhodes University and a History Hons from UCT. He lives in Cape Town.
As Public Employment Programmes (PEPs) gain popularity as social safety nets the world over, there is very little that speaks to the problem of measuring their impact on local economic development (LED), yet this is a key part of the policy case for programmes such as the Community Work Programme in South Africa.
On further examination, this lack of methodological clarity seems to apply to impact evaluation of LED interventions in general – and is not confined to the context of public employment programmes.
This paper provides a scoping study of a range of methodologies currently in use, and assesses their strengths and weaknesses in relation to different dimensions of local economic development.
Please join us to discuss the paper and to contribute to the debate on this issue.
Ellen Hagerman has nearly 10 years of experience working on regional economic development issues including trade, infrastructure, food security and governance. She has worked for the Canadian International Development Agency (CIDA) for 13 years as a Program Manager and Senior Analyst and has covered a diversity of other issues including corporate social responsibility and global environmental issues. While at the Canadian High Commission in South Africa representing CIDA's regional program for Southern and Eastern Africa, she was responsible for managing CIDA support to the African Peer Review Mechanism, the African Capacity Building Foundation, Southern African Trust and Southern African AIDS Trust. She also led two donor working groups on HIV/AIDS and food security and was the donor representative on two working committees linked to the Comprehensive African Agricultural Development Program (CAADP). Ellen is also a professional facilitator and has facilitated sessions on human rights, gender equality and intercultural communications as well as recent meetings on HIV/AIDS, health and food security. Ellen recently completed a research paper on the challenges to regional infrastructure in Africa for DBSA and is working as a research fellow at TIPS providing advice and undertaking research on issues related to regional economic development.
Glen Robbins is a part time Researcher at the School of Development Studies, University of KwaZulu-Natal and freelance consultant specialising in regional and local economic development with a focus on regional and city economic development strategies, infrastructure planning and financing and trade and industrial policy. Previously he headed up the Economic Development and City Enterprises functions in the eThekwini Municipality (Durban). Since 2003 he has been involved in teaching and research at the School of Development Studies and has contributed journal articles and book chapters on subjects ranging from municipal infrastructure investment to industrial policy and local economic development. He has also authored and co-authored reports for the Cities Alliance, UNCTAD, ILO and other multi-lateral bodies. In recent years he has worked with UNCTAD on a range of research projects in Southern and Eastern Africa and has recently completed a report, together with David Perkins, on infrastructure and mining investment in Tanzania and Mozambique for the Making the Most of Commodities Project coordinated at the University of Cape Town and the Open University (UK).
Francis Fay is Deputy Head of Unit in DG Agriculture and Rural Development of the European Commission, in the unit for Africa, Caribbean and the Pacific, G20/G8 and FAO. He has been closely associated with the development of agricultural product quality policy, including the protection in the EU of geographical indications. Francis is also part of the EPA negotiation teams with each African region. He formerly worked on the US and Cabada desk in agriculture. He has a background in agri-environment policy and read law at Trinity College, Dublin in Ireland.
Dr. Robert Kirk is Senior Vice President at AECOM International Development and was until recently the Chief of Party at the Southern African Trade Hub.
Robert, who is an expert in the area of trade policy analysis, has extensive experience in regional trade policy. He was formerly a policy advisor to the SADC Secretariat and served as an advisor to the Ministry of Finance in Swaziland on the SACU renegotiations (1995-2000).
Dr. Kirk has published on the new Southern African Customs Union Agreement, on rules of origin, on Non Tariff Barriers in Eastern and Southern Africa.
Wouter Schalken is a Namibian based researcher specialized in a number of areas around strategic tourism planning, analysis and development.
Wouter has worked for a number of development agencies (such as the UNDP, SIDA, USAID, the GTZ, the World Bank and UNESCO amongst others) at project-specific, national and regional levels. He has worked extensively on the African Continent (in Southern Africa, Ghana and Sierra Leone), in the Middle East (in Yemen) as well as in island states (such as the Maldives) where he has been involved in the formulation and evaluation of particular tourism development projects and strategies.
Wouter's project-specific expertise is extensive and includes developing implementation and management plans for tourism projects in all areas, including in wildlife areas. He has been engaged in a number of new eco-tourism projects for which he has had to identify economic opportunities. Wouter has also had to develop capacity building and awareness-raising in tourism in the course of his career. Beyond project work, Wouter has helped decision makers in
the identification of barriers to development and investments in tourism at country-wide levels.
Hamid Rashid is Senior Adviser for Macroeconomic Policy in Department of Economic and Social Affairs (DESA) of the United Nations. He leads a new UN initiative to provide alternative and credible policy advice to the Member States on fiscal, monetary and exchange rate related issues. The macroeconomic policy advice of the United Nations covers both short-term economic fluctuations and shocks and long-term national development strategies for sustainable and equitable growth. Dr. Rashid brings to DESA over twenty years of experience, working for the Government of Bangladesh and also for UNDP, the World Bank and UNICEF in Dhaka, Washington D.C. and New York.
Dr. Rashid earned his Ph.D. in Finance and Economics from Columbia University in New York, working under his advisor and mentor, Professor Joseph Stiglitz - the winner of the 2001 Nobel Prize in Economics. With Professor Stiglitz, he co-authored a monologue, “Travesty of Free Trade” in 2006, which was translated in over eight languages and published in over 200 newspapers worldwide. He obtained his MPA from Columbia University and Bachelor of Science degree from the University of Texas. His research interest includes international finance, macro-economic policies, financial market liberalization and their impact on economic growth and development. Dr. Rashid has taught graduate level courses in economics and public policy at the Columbia University, University of Manchester and the London Business School. He has widely traveled in Latin America, Africa, Asia and Europe.
About the Presenter:
Mmatlou Kalaba a research fellow at TIPS, specialising in trade research. He also carries out TIPS' capacity-building initiatives in the Southern African region, providing training courses on applied analytical and methodological tools. He currently holds a position in the Department of Agricultural Economics at the University of Pretoria. Some of the projects at university of Pretoria include The Joint Agribusiness Department of Agriculture Forum for Africa (JADAFA) under the auspices of Department of Agriculture, Forestry and
Fisheries (DAFF) and the Agriculture Business Chamber (ABC) as well as the Bureau for Food and Agricultural Policy (BFAP).
Current and previous responsibilities and projects include bilateral and multilateral trade analyses, SADC TRdae Database, the SADC Mid-Term Review, tariff and non-tariff analyses, reviews of tariff policies and related competitiveness issues and the Southern African Trade Database.
Mmatlou was previously with the National Agricultural Marketing Council (NAMC) and the National Department of Agriculture (NDA) as an economist and senior economist, respectively. His responsibilities included an investigation into impact of deregulation on the citrus industry and transformation in the agricultural sector. He also participated in the Food Price Monitoring Committee that investigated high food prices, the impact of deregulation on the wheat and citrus industries and transformation in the agricultural sector, and was involved
in developing regional research capacity.
South Africa's economic dominance in Africa and in the southern African region is an accepted fact but its role in the continent has long been contested. South Africa's member ship of the G20 brought with it expectations from some quarters that it would represent Africa within that grouping. The recent admission of South Africa into the BRIC(S) came with many discussions and debates on South Africa's role as a 'gateway' into Africa. But what does this actually mean? Three possibilities have been mooted: “First, multinational companies could use South Africa as a hub for regional headquarters, utilising our superior services infrastructure to co-ordinate their regional activities. Second, multinationals and South African corporates could take advantage of our relatively advanced transport and distribution networks. Third, companies could use South Africa as a sourcing hub.” However, as South Africa struggles with chronic unemployment and poverty problems, questions arise as to the potential and possibility of South Africa being a gateway into Africa. In an effort to unravel the issues, SAIIA and TIPS have come together for this dialogue which will reflect the views of government, business and labour.
SAIIA and TIPS have come together to create a platform for the discussion of the abovementioned issue.
About the presenters:
Peter Draper's current domestic affiliations include: Senior Research Fellow in the Economic Diplomacy programme at the South African Institute of International Affairs; Adjunct Professor at Wits Business School; Programme Director of the think tank consortium at the Centre for Development and Enterprise; and Research Associate of the Department of Political Science at the University of Pretoria. His current international affiliations include: board member of the Botswana Institute for Development Policy Analysis; non-resident senior fellow of the Brussels-based European Centre for International Political Economy; chair of the World Economic Forum's Global Agenda Council on Trade; and member of the World Economic Survey Expert Group coordinated by the Institute for Economic Research at the University of Munich.
Dianna Games is an independent consultant and researcher on African business. Since 2004, she has been CEO
of Africa At Work, a company that covers a range of services linked to business in Africa, and she has had a
number of research reports published. Her advisory and research work has included engagements by Nepad,
Comesa, Development Bank of Southern Africa, South African Institute for International Affairs, Brenthurst Foundation, United Nations, Gordon Institute for Business Science as well as international companies in South, Southern and West Africa. She is also the Honorary Chief Executive of the SA-Nigeria Chamber of Commerce and
a columnist on African issues for Business Day newspaper
Competition policy is playing an increasingly significant role in the trade and investment environment in South Africa. According to a 2010 IMF report, there is a high degree of product market restrictiveness in South Africa that is partly exacerbated by anti-competitive behaviour in the markets. This is regarded as being highly trade restrictive.
Also, the recent Wal-Mart/Massmart case brought under closer scrutiny the link between investment, competition and trade policy. It highlighted the potential use of competition policy as a vehicle for industrial policy and other domestic economic objectives. Can governments use competition policy to stimulate the growth and development of certain sectors, including through investment, and would this be compatible with the rules of the international trading system? In addition to creating a conducive policy environment, there are other direct measures used by the government to attract investment from both domestic and international sources. As is the case with many other developing countries, SA seeks to boost investment through a variety of incentive schemes that operate at the local, provincial and national level. These incentives have been put in place to support the various economic development objectives of SA. What type of incentives are being offered? How effective are they?
SAIIA, TIPS and Tralac have come together to create a platform for the discussion of these issues. Trudi Hartzenberg, from Tralac, will present on the interlink between competition, investment and trade policy in South Africa. Lesley Wentworth, an independent consultant for SAIIA will scope out the range of investment incentives currently being offered in South Africa.
William Mbuta was the Science and Technology Development Officer at the National Science and Technology Council of Zambia before becoming assistant general manager in the area of policy research at a Chamber of Mines; he them worked at the SADC Secretariat where he was Programme Officer – Industrial Policy at the between 2007 and 2010. William is now an independent consultant based in Lusaka.
Willam has prepared a working paper for TIPS on the theme which he will discuss at the seminar. William's working paper can be found on web-site home page (www.tips.org.za)
Trudi Hartzenberg is the Executive Director of the Trade Law Centre for Southern Africa (tralac). She is an economist specialised in trade, industrial and competition policy, regional integration and industrial organisation. She has taught at a number of Universities in South Africa as well as abroad, in Denmark. She has worked on assignment for a number of international institutions including the IMF, African Development Bank and the Commonwealth Secretariat.
Paul Kruger is a tralac researcher with special interests in trade negotiations, behind the border trade issues, industry competitiveness and sustainable development. He is a qualified lawyer and has been involved in a wide range of regional and international trade and trade related projects.
Tralac's research report and related policy brief on which the presentation will be based can also be found on our web-site home page (www.tips.org.za).
In 2005, India introduced the world's first employment guarantee, creating new meaning for the concept of a right to work. This is achieved through the National Rural Employment Guarantee Scheme, established through an act of parliament (NREGA), which gives every rural household the right to demand 100 days of employment (manual labour) per year at a minimum wage. With over 55 million participants, NREGA has become one of the largest poverty programmes in history. Since 2006, it has provided over two billion person-days of work – 48% of which have gone to women. It also includes real innovation in the use of transparency mechanisms to combat corruption. As a vital part of the campaign that saw India's government re-elected in 2009, it has also become politically unassailable.
But this programme is by no means perfect. It has struggled to ensure downward accountability to poor people, and to build an awareness of the rights in the Act at grassroots level; it has not always been able to overcome bureaucratic resistance, or to deepen intended collaboration with civil society. Design flaws have created problems (although several have been remedied). And yet its achievements are massive enough to make it an important example of innovation in poverty reduction as well as employment creation.
Professor James Manor holds the Anyaoku Chair at London University's Institute of Commonwealth Studies, a school that he previously directed. He has done research in South Africa and four other African countries, but he is mainly an India specialist. He and Professor Rob Jenkins in New York have done extensive field research on NREGA in villages and state capitals in India since 2007; they have worked with the ministry that administers this programme, and are in the process of completing a book on the subject.