The SADC free trade protocol as a vehicle for the Angolan post-war economic recovery

Lopes Cristovao, Antonio Francisco (2002-12)

Thesis (MA)--Stellenbosch University, 2002.

Thesis

ENGLISH ABSTRACT: Free trade is said to maximize welfare in a world organized by nation-states. To participate in the global economy more effectively most nation-states have implemented economic policies with the objective of freeing international trade. This movement has been facilitated by the process of globalization which has had unparalleled effects on the economic policies of countries worldwide. However, countries-have found it increasingly difficult to manage their economies at the multilateral level since the benefits of global free trade are not equally shared. This has led to an increase in Regional Integration Agreements (RIAs), which are seen as a tool for strategic growth and development while promoting free trade on a more restricted basis. In the last decades of the 20th century, the world has seen an increase in the number of RIAs particularly in Sub-Saharan Africa, However, empirical evidence has shown, contrary to what happened in Europe, that in Africa most attempts at economic integration have failed to promote meaningful economic growth and development. Notwithstanding that, the Southern African Development Community (SADC) has embraced economic integration as a strategy for growth in the region. Focusing on SADC and the Angolan economy as the main units of analysis, this study looks at the theory of economic integration to evaluate its validity for the African context and to find out how useful integration is in promoting economic growth and development in less developed countries. The study concludes that economic integration theory, which was developed within the context of European economies, is not relevant for African economies, which are different in character. Evidence indicates for instance, that in Africa the most important gains from economic integration are dynamic and not static, as the theory seems to suggest. Additionally, contrary to what happened in former attempts at forming RlAs in Africa, SADC has implemented a development integration approach aiming at industrialization. This is important, because according to the "Krugman-Venables model of regional relocation" the least developed countries can benefit from trade and investment from the most developed ones. The SADe Free Trade Protocol may be harmful for the Angolan economy in the short to medium term because of structural problems. However, it was found that if properly implemented it could playa major role in promoting growth and development in the longer term.

AFRIKAANSE OPSOMMING: Vrye handel, so word beweer, vermeerder welvaart in 'n wêreld wat deur nasie-state georganiseer word. Die ekonomiese beleid van nasie-state is daarop gemik om internasionale handel te dereguleer, ten einde hulle in staat te stelom meer effektief binne die globale ekonomie deel te neem. Hierdie proses is gefasiliteer deur die verskynsel van globalisering wat ongeëwenaarde gevolge vir alle state in die wêreld meegebring het. Nietemin, vind state dit in toenemende mate moeilik om hierdie proses op multilaterale vlak te bestuur, aangesien die voordele van internasionale handel nie in gelyke mate gedeel word nie. Dit het gely tot 'n toename in Streeksintegrasie-Ooreenkornste (SIO's ). Hierdie ooreenkomste word beskou as 'n ekonomiese groei en ontwikkeling-strategie, terwyl internasionale handelop 'n meer beperkte grondslag bevorder word. Tydens die laatse dekades van die twintigste eeu, het die aantal SIO's (veral in Sub-Sahara Afrika) toegeneem. In teenstelling met die ervaring van die Europese Unie, dui die feite aan dat pogings tot ekonomiese integrasie in Afrika nie daarin geslaag het om betekenisvolle ontwikkeling en ekonomiese groei te bevorder nie. Nietemin, het die Suider-Afrikaanse Ontwikkelingsgemeenskap (SAOG) handels-integrasie aanvaar as 'n strategie vir ekonomiese groei in die streek (met as instrument die SAOG Vryehandel-protokol). Met fokus op die SAOG en Angola as eenhede van analise, evalueer die studie die liberale teorie van ekonomiese integrasie, ten einde uitspraak te lewer oor die geldigheid daarvan binne die konteks van Afrika, Tweedens, word daar ook aandag geskenk aan die vraag of ekonomiese integrasie 'n optimale strategie is vir die bevordering van ekonomiese groei en ontwikkeling in minder-ontwikkelde lande. Die gevolgtrekking wat gemaak word is dat ekonomiese integrasie (soos ontwikkel binne die Wes-Europese konteks) nie relevant is vir die eiesoortige omstandighede van Afrikastate nie. Daar is, onder andere, bevind dat die belangrikste voordele van integrasie in Afrika dinamies is, en nie staties nie (soos die teorie van ekonomiese integrasie dit in die vooruitsig stel). Daarby, en teenstrydig met vorige pogings tot die vorming van SIO's in Afrika, het die SAOG 'n ontwikkelings integrasie benadering aanvaar. Hierdie benadering is gemik op eweredige industrialisering in die streek. Dit is 'n belangrike punt, want volgens die "Krugman-Venables model van streekshervestiging" kan die minder ontwikkelde state voordeel trek van handel met, en beleggings uit die meer ontwikkelde state in die streek. Laatstens, is daar bevind dat die SAOG Vryehandel-protokol in die kort tot medium termyn nadelige gevolge vir Angola sal meebring. Dit is as gevolg van strukturele probleme in die Angolese ekonomie. Nietemin, indien behoorlik geïmplementeer, kan dit 'n betekenisvolle rol speel in die bevordering van ekonomiese groei en ontwikkeling oor die lang termyn.

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