Investigating options for economic cooperation between emerging markets : a case study on the Southern African Development Community (SADC) and Black Sea Economic Cooperation (BSEC)
Date
2022-12
Authors
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Publisher
Stellenbosch : Stellenbosch University
Abstract
ENGLISH SUMMARY: Emerging markets are often bearing the brunt of negative spill over effects from situations influencing global superpowers such as the US-China trade war. In order to hedge against becoming too dependent on these large markets, market diversification is posed as a potential solution for these smaller markets to hedge against these spill overs. It can be argued that in order for emerging markets to increase their resilience against such negative shocks, having a diversified trade base is important.
To date, few substantial studies exist on the value of trade diversification between emerging markets, let alone emerging trade blocs such as the Southern African Development Community (SADC) and the Black Sea Economic Cooperation (BSEC). The aim of this dissertation was to investigate whether the case study countries possess the needed infrastructure to engage in trade as well as to determine if economic cooperation can take place between SADC and BSEC amidst the Russo-Ukraine war. The primary research question of this paper was to determine the extent to which SADC countries could viably improve economic relations with BSEC, especially Georgia, Turkey and Ukraine. This dissertation relied mainly on secondary data in the forms of documentary and archival research such as industry reports, newspaper articles and infrastructural datasets. In order to achieve the aim, data was collected by means of media sources-, documentary and archival research. This data was used to firstly determine the infrastructural landscape of each case study country with regards to transportation and logistics. This information presented a clear idea of each country’s infrastructural and logistical challenges which in turn served to inform the extent to which trade is possible between SADC and BSEC. Secondly, data was collected regarding the Russo-Ukraine conflict in order to determine a potential way for the case study countries to still engage in some form of economic collaboration without resorting to physical trade which seems less practical regarding the dangers of operating in the Black Sea at present. The key findings of this thesis indicated that the SADC case study countries’ logistical and transport infrastructure ranked higher than those of BSEC in general. Although South Africa was a clear infrastructure leader, Namibia ranked very close to Ukraine and Georgia in some sections of Global Competitiveness and Logistics performance. It was found that all of the case study countries possessed the needed infrastructure to enable trade – but the extent to which the infrastructure in question was optimal, would depend highly on the commodity transported. The outbreak of the Russo-Ukraine conflict in February 2022, and the consequent infrastructure destruction rendered much of the information in Ukraine obsolete. However, this provided an excellent opportunity to research the spill over effects of this war on the emerging market case study countries. Some of the ways in which the emerging markets was affected by this conflict included pressure from the global community to choose sides, where their standing globally was consequently affected due to those choices. The SADC case study countries chose neutrality while the BSEC countries chose Pro-Ukraine outlooks. With these positions in mind, this dissertation posed economic cooperation as a potential way to increase economic relations between the case study countries. It was suggested that this approach not only occur at a more formal, integrated level, but that this also precedes physical trade as estimator of the viability thereof. In conclusion, this dissertation achieved its aims and has determined that despite the conflict, SADC and BSEC could still potentially engage in economic cooperation to a large extent.
AFRIKAANSE OPSOMMING: Geen opsomming beskikbaar.
AFRIKAANSE OPSOMMING: Geen opsomming beskikbaar.
Description
Thesis (MCom)--Stellenbosch University, 2022.
Keywords
Black Sea Coast -- Foreign economic relations, Economic Cooperation, Exports Diversification, Emerging markets, UCTD