http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.29Change: -0.09
R/$ = 11.70Change: -0.05
Au 1207.85 $/ozChange: 1.57
Pt 1174.50 $/ozChange: -1.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Jun 08, 2012

A weaker rand will offer protection against imports

Back
Africa|Asphalt|Generator|Mining|System|Water|Africa|Albania|South Africa|Contracting|Equipment|Manufacturing|Manufacturing Industry|Service|SARS|Adriatic Sea|Water|Adriatic|Eastern Europe
Africa|Asphalt|Generator|Mining|System|Water|Africa||Contracting|Equipment|Manufacturing|Service|||Water|
africa-company|asphalt|generator|mining|system|water-company|africa|albania|south-africa|contracting|equipment|manufacturing|manufacturing-industry|service|sars-medical-condition|adriatic-sea|water|adriatic|eastern-europe
© Reuse this



The debate in the media with respect to the strength of the rand and the major international currencies does not seem to have lost any momentum and is unlikely to do so any time soon, particularly if the perception that the rand is too strong in comparison with the major international currencies persists.

The argument one hears frequently is that, as a consequence of its strength, the rand exposes South Africa to cheap imports, while impacting on South African exports’ competitiveness – a double whammy, if you will.

This has resulted in calls from certain quarters, particularly the manufacturing industry, for the weakening of the rand against the major international currencies, which, it is argued, will decrease the com- petitiveness of imported goods and increase the competitiveness of South Africa’s exports.

My intention is not to be involved in this debate and to deliberate on the merits or demerits of a weakened rand; rather, it is to question whether calls for the weakening of the rand are not masking the fact that the increase in the ‘general’ rate of customs is not possibly the result of South Africa’s participation in the World Trade Organisation (WTO) by explaining certain aspects of the organisation.

Prior to the creation of the WTO – on January 1, 1995 – the imposition of customs duties as a protective function or as a revenue generator was the sole domain of governments. The WTO, however, introduced ‘bound rates’ following negotiation of the ‘general’ rate of customs duty. In essence, a bound rate is the ‘ceiling’ of the rate of customs duty – the highest rate of customs duty that can be imposed on a given tariff subheading, of which there are more than 7 000.

As a consequence, should the ‘general’ rate of customs duty be set at the bound rate, then a higher rate of customs duty cannot be imposed, thus nullifying customs duty as a measure of protection. (The prevailing rate of customs duty is called the applied rate. The difference between the bound rate and the applied rate is called the ‘policy space’ or the ‘water in the tariff’.)

If there is no policy space, then the only measure available to South African manufacturers to tackle competition, including unfair competition, is the impo- sition of trade remedies, namely anti- dumping duties or countervailing duties (antisubsidy duties). As for fair competition, there is no protective measure avail- able other than safeguard duties. At present, no safeguard duties are imposed, and the reasons for this is could be the subject of an article for another day. Weakening the rand against major international currencies could provide what is referred to as ‘natural protection’. So, in essence, a weak currency could also serve as a protective measure.

Albania Now HS Contracting Party
On May 21, the World Customs Organi- sation (WCO) informed that, on May 16, Albania deposited its instrument of accession to the International Con- vention on the Harmonised Com- modity Descrip- tion and Coding System (Harmo- nised System, or HS) with the secretary-general of the organisation, becoming the 142nd contracting party to the HS convention. More than 98% of international merchandise trade is classified in terms of the Harmo- nised System. Albania is located in south-eastern Europe, bordering the Adriatic Sea. Its principal export commodities are textiles and footwear, asphalt, metals and metallic ores, crude oil, vegetables, fruit and tobacco. Albania’s principal import commodi- ties are machinery and equipment, foodstuffs, textiles and chemicals. The HS convention will enter into force in Albania on January 1, 2014.
Albania has been a member of the WCO since August 31, 1992.

Court Rules: Tariff Classification in SARS’ Favour
On May 18, the South African Revenue Service (Sars) informed of the judgement in its favour with respect to an appeal against the tariff determination (classification) of the ‘general purpose’ of a utility vehicle.
The appeal was heard by the North Gauteng High Court, with Sars being the appellant and Smith Mining Equipment the respondent. The tariff subheadings in question are 8704.21.80 and 8709.19.

Tariff Corrections
On May 25, Sars published a correction notice in respect of Schedule No 5 of the Act, amending the drawback codes and check digits in drawback items 540.01/195.10/01.00 and 537.02/87.00.

Edited by: Martin Zhuwakinyu
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Trade@Work News
When conceptualising this column, I thought of writing about my customs and excise duty (inclusive of tax and levy) expectations for the 2015 Budget, to be delivered by Finance Minister Nhlanhla Nene on February 25. The timing would have allowed you to read the...
George Bernard Shaw observed that Britain and America were two nations divided by a common language. The same can be said of the building blocks of the language – its words, with meaning tending to differ, depending on the context in which they are used. This seems...
2017's Harmonized Nomenclature Tariff Amendments Albert Einstein said that the only reason for time is so that everything does not happen at once. What I am about to tell you will only enter into force on January 1, 2017. Yes, January 1, 2017. Talk of advanced notice.
More
 
 
Latest News
Oger Telecom is looking at the possibility of selling its majority stake in Cell C, South Africa's third-largest mobile telecoms network operator, the chairman of the Middle Eastern firm told Reuters on Thursday. Goldman Sachs has been appointed by Oger Telecom to...
South Africa’s national oil company PetroSA, through its subisidiary PetroSA Ghana, has secured a seven-year $150-million reserve-based lending credit facility with a consortium of banks. PetroSA CFO Lindiwe Bakoro said the company was pleased to close this...
The $200-million ‘loop line 1’ project to expand the capacity of the gas pipeline from Mozambique to South Africa has been completed, the Republic of Mozambique Pipeline Investments Company (Rompco) has confirmed. Rompco is the gas transport joint venture set up in...
More
 
 
Recent Research Reports
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
 
 
 
 
 
This Week's Magazine
Updated 1 hour 49 minutes ago The World Bank, the European Union, the African Development Bank (AfDB) and the government of Sweden have agreed to provide Zimbabwe and Zambia with $294-million for the repair of structural deformations on the Kariba dam wall and avert the possible collapse of the...
Global Electricity Initiative executive chairperson Philippe Joubert
Updated 1 hour 49 minutes ago Executive chairperson of the Global Electricity Initiative (GEI) Philippe Joubert says energy utilities globally, together with the business community more generally, have come to terms with the science of climate change, particularly as extreme weather events begin...
JAMES TEMPLETON Emira’s operational performance is the best it has been in a long time
Updated 1 hour 49 minutes ago JSE-listed Emira Property Fund reported distribution growth per participatory interest (PI) of 9% for the six months ended December 31, 2014.
JOAN MACNAUGHTON Many countries were also struggling to balance the energy trilemma of energy security, energy equity and environmental sustainability
Updated 1 hour 49 minutes ago Sub-Saharan Africa is still faced with the challenge of providing citizens access to electricity and an additional $450-billion will need to be invested to ensure that people in urban areas have access to electricity by 2040.
ABE THELA Cuban engineering skills are not recognised by the Engineering Council of South Africa
Updated 1 hour 49 minutes ago Consulting Engineers South Africa (Cesa) last month said it was dismayed that the Department of Water and Sanitation (DWS) was seconding 35 Cuban engineers on a two-year contract to share their expertise with South African engineers in the water sector.
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $96 Close
Subscribe Now for $96