http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.89Change: -0.01
R/$ = 12.56Change: 0.01
Au 1097.15 $/ozChange: 1.80
Pt 988.50 $/ozChange: 5.50
 
 
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 07, 2012

A weaker rand will offer protection against imports

Back
Africa|Asphalt|Export|Generator|Mining|System|Water|Africa|Albania|South Africa|Contracting|Equipment|Manufacturing|Manufacturing Industry|Service|SARS|Adriatic Sea|Water|Adriatic|Eastern Europe
Africa|Asphalt|Export|Generator|Mining|System|Water|Africa||Contracting|Equipment|Manufacturing|Service|||Water|
africa-company|asphalt|export|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
Creamer Media Senior Deputy Editor
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Trade@Work News
On July 10, the International Trade Administration Commission (Itac) published its final determination to not exclude tinted glass mirrors, classifiable under tariff subheading 7009.91, from existing antidumping duties applicable to unframed glass mirrors originating...
To avoid any confusion or misunderstanding, the focus of this column is not on taxes on those among us who could be considered overweight, but on taxing that which is externality induced, including excess accumulation of body fat. In essence, the suggestion is to tax...
The Department of Trade and Industry (DTI) announced on June 21 that Trade and Industry Minister Dr Rob Davies had inaugurated the National Export Advisory Council (NEAC) at the Team Export South Africa workshop, held in Pretoria from June 19 to 21 under the theme...
More
 
 
Latest News
Updated 44 minutes ago This eight-page brief covers key developments in South Africa’s water sector over the past 12 months. It provides details of the state of South Africa’s water sector, planning and regulation, infrastructure, nonrevenue water and water-quality issues, as well as...
Transnet National Ports Authority CIO Mmutle Lentle
State-owned enterprise Transnet National Ports Authority’s (TNPA’s) new Web-based integrated port management system (IPMS) went live on July 26 at the Port of Durban, with crude oil tanker Colorado being the first vessel to be brought into the port using the new...
South Africa’s automotive industry is not in crisis – but there is a very real danger that inertia could see it regress into lightweight assembly rather than claim its place as a globally competitive vehicle manufacturer. Speaking at the National Localisation Indaba,...
More
 
 
Recent Research Reports
Real Economy Year Book 2015 (PDF Report)
There are very few beacons of hope on South Africa’s economic horizon. Economic growth is weak, unemployment is rising, electricity supply is insufficient to meet demand and/or spur growth, with poor prospects for many of the commodities mined and exported. However,...
Real Economy Insight: Automotive 2015 (PDF Report)
Creamer Media’s Real Economy Year Book comprises separate reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, gold, iron-ore and platinum sectors.
Real Economy Insight: Water 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
Real Economy Insight: Construction 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
Real Economy Insight: Electricity 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
Real Economy Insight: Road and Rail 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
 
 
 
 
 
This Week's Magazine
Meyerton-based steel tank manufacturer Structa Technology is currently rolling out a water infrastructure build programme that supports local municipalities, water utilities, schools, hospitals and clinics. As a member of the Structa Group, Structa Technology proudly...
Alternative funding models could be expected to begin coming to the fore in South Africa’s renewable-energy sector as the market becomes more competitive and domestic development finance institutions (DFIs) begin scaling back their direct involvement in projects....
DIMITRI MARKOULIDES An innovation champion must involve employees in innovation projects and keep them updated to enable them to support and drive innovation and create the future of the business
An innovation champion course that trains executives to manage innovation in their organisations aims to help companies grow revenue streams and tap new markets, says business change management consultancy BMGI South Africa innovation practice lead Dimitri...
Future digital workplaces will require employees to continuously learn new “literacies”, including new media, information and technical skills, to help their company thrive and spur personal growth. Information technology (IT) research firm Gartner, thus, suggests...
Only 25% of large construction projects surveyed in KPMG’s Global Construction Project Owner’s Survey, released in June, were concluded on time and within budget over the last three years. “Every project owner wants predictability when it comes to large projects, and...
 
 
 
 
 
 
 
 
 
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