Call for Research Proposal

Proposals for research projects are hereby solicited from African researchers on subject areas
in line with the WTO mandates and objectives.
In particular, for the 2011 Edition, we welcome proposals addressing, but not limited to the
following themes:

* Trade issues in energy, natural resources, and food security
* WTO and climate change
* WTO and economic crises
* Governance, Trade and Economic Development
* Binding Constraints to Trade Expansion: Is Aid for Trade the Solution?
* NTMs : Obstacles to Trade and Growth
* Competition Policy and Trade Liberalisation: The Nexus

Submission of Proposals

Proposals designed along the guidelines specified below should be submitted electronically
to the secretariat (wtochairmauritius@uom.ac.mu, copied to Dr V Tandrayen
(vtandrayen@uom.ac.mu) and Dr B Seetanah (b.seetanah@uom.ac.mu)

Important Dates

The deadline for submitting proposals is February 28th 2011. Selected researchers will be
notified by March 15th 2011 .The first draft of the study is due on 15th April 2011 and the
final on 15th June 2011.

South Africa's trade policy has undergone much change as the country approaches its second decade of democracy. In particular, of more recent interest on the global sphere, and hence on the domestic front, have been the trade issues du jour, including trade in services and behind-the-border issues such as non-tariff measures and competition.

Trade remains an important facet of the country's economy, and although growth has improved since the 1990s when economic growth of 1% was being experienced, it is generally agreed that South Africa needs to grow its economy by more than the 5% it is averaging currently per annum. Increasing growth in the country's exports is seen as one key objective in the country's path to achieving more robust growth, but of course a crucial question is how this can be done.

Numerous challenges have arisen which have affected South Africa's ability to realise this objective. Amongst these are issues such as volatility of the exchange rate and a widening trade deficit, together with political crises plaguing African trading partners such as Kenya and Zimbabwe. Expanding infrastructure bottlenecks, for example related to maritime transport, and increasing uncertainty regarding energy supply are further limiting factors that are not part of the trade policy arena per se, but do impact on the country's ability to expand its exports. This is also linked to an important area of policy concern, which relates to how trade policy complements, and is complemented by, other economic policies, such as the industrial policy, in a pragmatic way. On the bilateral and multilateral front further difficulties have arisen, for example, within the context of the Doha negotiations related to liberalisation in agriculture, as well as the Economic Partnership Agreement (EPA) negotiations with the European Union (EU).
 

Introduction

China became South Africa's biggest trading partner in 2009, when total trade between the two countries amounted to US$14.1 billion (ZAR119.5 billion). China's appearance at the top of the rankings was partly due to the global recession, which affected trade levels of the industrialised countries far more than those of emerging markets. Germany had been South Africa's biggest trading partner up to 2008, when Germany-South Africa trade totalled US$17.9 billion (ZAR148.3 billion), compared with US$ 14.2 billion (ZAR 116.8 billion) between South Africa and China. But in 2009, South Africa's trade with Germany dropped 35.5 percent in US dollar terms, while trade with China rose marginally by 1.8 percent and China moved to the top of the rankings. But total trade between South Africa and China had grown by 26.5 percent per annum (in US dollar terms) between 2000 and 2009, so that it was only a matter of time before China became the country's largest trading partner.1
The importance to South Africa of its trade relationship with China raises the question as to whether the foreign direct investment (FDI) relationship between the two countries is equally significant. While much has been written about China's growing investment presence in South Africa and in many other African economies, very Little of this discussion has been based on detailed empirical analysis or been located explicitly within the theory of foreign direct investment. It is important to examine the FDI linkages not only quantitatively, but also qualitatively, in terms of their impact on
economic growth and on the internationalisation of business in the two countries. This paper investigates these issues looking at the FDI links in both directions between China and South Africa.

The paper has two parts. Part A examines the size and structure of the bilateral FDI relationship between South Africa and China. Section I reviews the estimates provided in the literature regarding the size of the relationship. Section II reviews the FDI policies of the two countries, on both inward and outward FDI. Section III examines official data from both countries on the value of FDI stocks and flows between them, and Section IV assesses the importance of the bilateral relationship to
each partner by contextualising it within the two countries' overall FDI stocks and flows, also using official data. Sections V through VII turn to firm-level data from The EDGE Institute FDI Database, a living database with verified data on firms' cross-border operations. Section V reports on the number of firms and their sectoral distribution, while Sections VI and VII discuss firms' dates of entry and mode of entry respectively. Section VIII concludes Part A of the paper.

Part B presents case studies of two sectors in which the China-South Africa FDI relationship is prominent: assembly of home electronic appliances ('brown goods') by Chinese firms in South Africa, and financial services in both countries. The case studies use firm interviews and extensive documentary analysis to examine both the internationalisation process of firms from the two countries as well as the broader economic impact within the two economies of their FDI relationship. The discussion is framed by the analytical questions and policy challenges raised by the growing importance of 'South-South' FDI, of which the China-South Africa link is an example.

This report takes a closer look at the trade and the trade agreements between South Africa and its free trade agreement (FTA) partners. Although the pace of unilateral trade reform has slowed, trade liberalisation has occurred through the negotiation of a number of bilateral trade agreements.

Brent Cloete from DNA Economics will discuss the motivation for a carbon tax, its history around the world, its likely economic, social and environmental impacts and the considerations for an optimal tax design.
Peet du Plooy from TIPS will then consider the role that a carbon tax could potentially play as an instrument of macro-economic policy and its role in terms of the international climate negotiations.

About Brent Cloete:

Brent Cloete is an Economist at DNA Economics (http://www.dnaeconomics.com). Brent has provided strategy and advisory services to a number of public and private sector clients in South Africa and has worked on issues in a number of African countries including manufacturing diversification in Mozambique, trade facilitation in East Africa, prospects for economic recovery in Zimbabwe, and an organisational review of priority ministries in Rwanda. His current focus is on climate change economics. Brent led a team working on a study for the National Economic Development and Labour Council (NEDLAC) on the potential use of economic instruments to mitigate climate change in South Africa. He is currently part of a team assisting the WWF with its strategy to guide South Africa towards a low-carbon economy, and is involved in a project to evaluate and manage the impact of climate change on the South African fruit and wine industry. Brent holds an M.Comm in Economics from the University of Stellenbosch.

About Peet du Plooy:

Peet is the manager of the Sustainable Development project at TIPS. He has a degree in Mechanical Engineering from the University of Pretoria. After working in energy R&D at the national utility Eskom, he joined the global environmental NGO, WWF, as Trade & Investment Advisor for South Africa. He was elected in 2009 as chair of the South African green industries association, the Environmental Goods and Services Forum. His areas of expertise are networked infrastructure (including energy, transport and ICT) and the economics of sustainability.

Rozale Sewduth joined TIPS in 2010. Her portfolio at TIPS includes organising events and conferences and she co-ordinates the TIPS training workshop programme. She was involved with providing administrative support to the Community Work Programme (CWP) during the handover period from TIPS to the Department of Cooperative Governance and was part of the team that designed and implemented the TIPS Geographical Information System (GIS) community mapping tool.

Rozale has more than 10 years' working experience. Her core capabilities are project coordination, contract management, customer relations, staff supervision, office management and personal assistant duties. She has extensive experience in managing events and conferences at a national and international level.

She has worked both locally and internationally: United States of America, United Kingdom and South Africa and holds a diploma in Business Management and Administration and completed the Project Administration course through UCT. She has a certificate in Strategic Event Management

Prior to TIPS Rozale was employed at the ComMark Trust as Executive PA and Office Manager.

Dr Thomas has a +18-year track record of outstanding performance as a senior executive, advisor on regional infrastructure and PPPs, development finance, private sector development, risk management, governance, trade and investment, and policy and capacity development in Africa with extensive knowledge of key regional economic concerns in Africa. She is currently a partner in a new enterprise, in partnership with a New York based Investment Bank, to form a joint venture - Africa Rising Capital (Pty) Ltd trading as Nova Capital Africa - providing investment banking services in South Africa and the rest of the continent.

As a Director of the NEPAD, Regional Integration (RI) and Trade Department at the African Development Bank (AfDB) in Tunisia from 2007-2008, she introduced innovative thinking into the Bank’s business on RI and regional infrastructure, including the NEPAD strategy on Development Corridors and SDIs, which still forms the basis of that department’s activities to date. She successfully managed the African Aid for Trade Meeting in Dar es Salaam in September 2007. By December 2007 she had mobilized for the NEPAD Infrastructure Project Preparation Fund (IPPF), then a USD10 million facility, an additional +USD50 million from various donors including a net income contribution from the Bank.

As the founding Chief Executive Officer of the SADC Development Finance Resource Centre (DFRC) in Gaborone, Botswana from 2003-2007, she supported efforts towards financial sector integration; built the capacity of DFIs on inter alia, corporate governance, enterprise-wide and credit risk management and financial sector reform. She supported the development of Public Private Partnerships (PPPs) in infrastructure, and strengthening DFI skills on investment appraisal and risk analysis, as well as on SMEs development and financing. From January 2002-July 2003 when seconded to the SADC Secretariat by the National Treasury she helped to manage the development of the SADC Finance and Investment Protocol, and was engaged as a Team member in developing the Regional Indicative Strategic Development Plan, SADC’s 15 year development strategy, authoring Chapter 5 on the sustainable financing of the RISDP.
Dr. Thomas was the first African and second woman to hold a position from 2005-2007 on the world-wide Technical Advisory Panel of the World Bank'sPublic-Private Infrastructure Advisory Facility (PPIAF). The Panel reports to PPIAF's 15 donors on the performance of the PPIAF team in facilitating private participation in infrastructure projects in developing countries.
From 1998-2001, she was Manager of the Risk Management Unit at the Development Bank of Southern Africa (DBSA). During this period the Unit’s risk policies were a significant influential factor enabling the DBSA to obtain two international credit ratings from Moody’s and Standard and Poor’s.

She holds a Ph.D. in International Economic Law from the University of Witwatersrand; an MA in International Economics and Law from SAIS - Johns Hopkins University in Washington, D.C.; has done post-graduate studies at Harvard University, Yale Law School, the University of Cambridge in the UK, and has been awarded six scholarships for educational excellence. Dr. Thomas has authored numerous professional publications; guest lectured at numerous universities and participated in several consulting studies and conferences.