south africa trade and investment policy secretariat . and us agency for international developemnt

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SOUTH AFRICA
TRADE AND INVESTMENT POLICY SECRETARIAT
. AND
U.S. AGENCY FOR INTERNATIONAL DEVELOPEMNT
EQUITY AND GROWTH THROUGH.
ECONOMIC RESEARCH
o
(PROJECT EAGER)
WORKSHOP
Glenburn Lodge
Muldersdrift, South Africa
o
February 4-6, 1998
PRELIMINARY AGENDA
(Version 10:00·p.!?, Tues., 3Feb. 1998)
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TUESDAY, FEBRUARY 3
18:00-19:30 REGISTRATION
19:30-20:00 MEETING OF PARTICIPANTS·
lVEDNESDAY,FEBRUARY 4.' PROJECTEAGER: RESEARCHANDPOLICY
lVITHAPPLICATIONTO SOUTHAFRICA
08~30-09:00 REGISTRATION
09:00-10:00 OPENING SESSION
Chair: Prof. Rashad Cassim [Director, Trade and Industrial Policy Secretariat (TIPS)]
Rapporteur: Dr. Abdoul Barry [AIRD, USA]
Welcome and Opening Remarks: Prof. Rashad Cassim [TIPS]
Overview ofEAGER:
Dr. Dirck Stryker [AIRD, USA, ChiefofParty, EAGER/Trade] and
Dr. Clive Gray [HIID, USA, ChiefofParty, EAGER/PSGE]
o Ms. Rita Aggarwal[Economist, Africa Bureau, USAIDI\Vashington] .
USAID\Velcome: Mr. Aaron Williams, Director,USAID/South Africa
10:00-10:30 Coffee Break
10:30-12:30 SlTh-LYIARYOF EAGER RESEARCH
Chair: Rashad Cassim [TIPS]
Rapporteur: Dr. Abdoul Barry [AIRD, USA]
Presenters: Dr. Dirck Stryker [AIRD, USA]
Dr. Clive Gray [HIID, USA]
12:30-14:00 Lunch
14:00-16:00 POLICY l\tIAKING, THE PRIVATE SECTOR, Al'cl) THE ROLE OF
ECONOMIC RESEARCH
Chair:' Dr. AshgarAdelzadeh [NIEP]
Rapporteur: Prof. \Villiam Masters [Purdue Universty, USA]
Panel: Mr. Hamet Ndour·(REMIX, Senegal)
o
Mr. Neal Cohen (USAID/REDSO/East, Kenya)
16:00-16:30 Coffee Break
16:30-18:00 CURRENT ISSUES IN THE SOUTH AFRICAN ECOI\"OMY
Chair: TBA
Rapporteur: Dr. Malcolm McPherson [Senior Advisor, EAGER/PSGE, HUD, USA]
Panel: Dr. Ashgar Adelzadeh [NIEP]
Dr. Neva Makgetla [Dept. ofPublic Service and Administration]
Dr. Rashad Cassim [TIPS - South Africa].
18:30- 19:30 EAGER AND THE INTERNET: Live Demonstration ofthe World Wide Web
and the Use of E-Mail
Demonstrator: Dr. Djime Adoum [BHM, USA]
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THURSDAY, FEBRUARY 5: SESSIONS ON EAGER RESEARCH THEMES
09:00-10:30 PLENARYSESSI01V: RESTARTL~GAND SUSTAL';1NG GRO\VTH AND
DEVELOP~IENT IN AFRICA
Chair: Dr. Daniel Ndlela [Zimconsult, Zimbabwe, Regional Coordinator for East and
SOllthern Africa, EAGERffrade] .
Rapporteur: Prof. Donald Mead [Michigan State University, USA]
Presenters: Dr. Ngure Mwaniki [MA Consulting Group, Kenya]; Prof. Abdoulaye Diagne
[CREA, Senegal]; Dr. J. C. Munene [MISR, Uganda]; Dr. Malcolm
McPherson, Dr. Arthur Goldsmith, and Dr. Clive Gray [all HUD, USA]
Discussant: Dr. Diery Seck [lDRC, Senegal]
10:30-11:00 Coffee Break
PARALLEL SESSIONS:
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11:00-12:30 GLOBAL TRADE ANALYSIS FORSOUTHERN AFRICA
Chair: Dr. Temba tvlhlongo [DTI]
Rapporteur: Dr.. Daniel Ndlela [Zimconsult, Zimbabwe]
Presenters: Prof. William Masters [Purdue University, USA] Global Trade Analysis for
Southern Africa
Prof. Inyambo Mwanawina [UniversityofZambia, Zambia],The Impactof
Capital Flows to South Africa
Prof. Robert Davies [University ofZimbabwe, Zimbabwe], The Impact ofSA
EU and SADC Free-Trade Agreements
Discussant: Prof. DominiqueNjinkeu[AERC, Kenya]
11:00-12:30 BARRIERS TO AGRICULTURAL TRADE
Chair: Dr. Dunstan Spencer [Dunstan SpencerAssociates, SierraLeone, Regonal
Coordinator for \Vest and Central Africa, EAGER/Trade]
Rappo~eur: Prof. Lucie Phillips [IBI, USA]
Presenter: Dr. Fred Opio [EPRC, Uganda], Comparative Advantage andIntra-Regional
Trade for Uganda's Low Value Non-traditional Export Crops: the Case ofMaize
o and Beans
Discussant: Mr. Neal Cohen (USAIDIREDSO, Kenya]
Presenter: Dr. Abdoul Barry [AIRD, USA], Promotion ofMali's Rice ExportsTowards the
\Vest African Regional Market
Dr. Abdoul Barry [AIRD, USA], Impact ofAdjustment on Agricultural
Competitiveness and Regional Trade in Sahelian \Vest Africa
Discussant: Prof.Abdoulaye Diagne [CREA, Senegal]
II:00-12:30 LEGAL-REGULATORY-JUDICIAL (LRJ)REFOR1''1S AND
GOVER.1'\TANCE
Chair: TBA
Rapporteur:. Dr. Arthur Goldsmith {HIID, USA]
Presenter: Prof. Patrick tvleagher [IRIS, USA] and Dr. Haji Semboja [ESRF, Tanzania],
Business Contracting Practices in Tanzania
12:30-14:00 Lunch
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j
14:00-15:30 TAX POLICY REFORi\1
Chair: Dr. Diery Seck {IDRC, Senegal]
Rapporteur: Dr. Eric Nelson [DAI, USA]
Presenters: Dr. Pepe Andrianomanana [CEE, ~Iadagascar] and Dr. Clive Gray [HIID,
USA], Enhandng Transparency in Tax Administration
Discussant: Prof. Arthur Goldsmith [UniversityofMassachllsett/Boston, USA]
Presenters: Dr. Pepe Andrianomanana [CEE, Madagascar] and rvlr. Jean Razafindravonona
[EPM, Madagascar], Tax Policy in Sub-SaharanAfrica: The Role ofExcise
Taxes
Discussant: Mr.Daniel Ramarokoto [Executive Secretary, SecretariatTechnique de
I'Ajustement (STA), Madagascar]
14:00-15:30 PROMOTING AN ENVIRONMENT FORPRIVATE SECTORACTIVITY
Chair: Dr. Ngure Mwaniki [M.A. Consulting Group, Kenya]
Rapporteur: Prof. Patrick Meagher [IRIS, USA]
Presenters: Dr. Polycarp Musinguzi [BOU, Uganda] and Dr. Marios B. Obwona [EPRC,
o
Uganda], Monetary and Exchange Rate Policy in Uganda
Discussant: Dr. Andrew Bvumbe [Reserve BankofZimbabwe, Zimbabwe]
Presenter: Prof. Germina Ssemogerere [Makerere University], Industrial Competitiveness in
. Kenya and Uganda
Discussant: Prof. Margaret McMillan [IBI, USA]
14:00-15:30 LABORIVIARKETS, El\tIPLOYlVIENT,AND PRODUCTIVITYIN SOUTH
AFRICA
Chair: Prof. Rashad Cassim {TIPS]
Rapporteur: Prof. Robert Davies [UniversityofZimbabwe]
Presenters: Prof. FlIadCassim [UniversityofWitwatersrand, SouthAfrica]and J. Dirck
Stryker [AIRD, USAl, Increasing Labour Demand and Productivity in South
Africa
Discussant: Prof. Donald Mead [Michigan State University, USA]
Presenter: Ms. Lynn Salinger [AIRD, USA], Dr. Haroon Bhorat [UCT], and Mr. Malcom
Keswell[University ofNatal/Durban], South Africa: Potential, Constraints, and
Comparative Advantage in the Textiles and Clothing Subsector
o Discussant: Ms. Keryn House [DTI}
15:30-16:00 Coffee Break
16:00-17:30 CREATING A NET\VORK OF POLICY RESEARCH IN AFRICA
Chair: Mr. Richard Harber,Economist, USAID/South Africa
Rapporteur: Prof. Lynn Salinger [AIRD, USA]
Panel: Dr. Diery Seck [IDRC, Senegal]
Prof. Rashad Cassim [TIPS]
Prof. Abdoulaye Diagne [CREA, Senegal]
Dr. Fred Opio [EPRC, Uganda]
Dr. Dirck Stryker [AIRD, USA]
Dr. Clive Gray [HIID, USA]
18:00-21:00 RECEPTION
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FRIDAY: FEBRUARY AM: PARALLEL SESSIDiVS DiVRESEARCHTHEMES:
08:00-09:00 GLOBAL TRADE ANALYSIS SOFT\VARE DEMO~STRATION
Demonstrator: Prof. \Villiam Masters [Purdue University, USA]
11:00-12:30 CONTRIBUTION OF BUSINESS LINKAGES TO THE GRO\VTH OF
PRODUCTIVE EMPLOYMENT AMONG l\tIICRO AND SlVIALL
ENTERPRISES IN SOUTH AFRICA
Chair: Dr. John Munene [Makerere Institute for Social Research, Uganda]
Rapporteur: Dr; Dunstan Spencer [Dunstan SpencerAssociates, Sierra Leone]
Presenters: Ed Bbenkele [Univ. ofNataliPietermaritzburg, S. Africa], Owen Skae [Univ. of
Natal/Durban, S. Africa], Francis Anim [Univ. ofthe North, S. Africa], and
Donald Mead [Michigan State Univ., USA]
Discussant: Mr. Bala Rajaratnam [Ntsika, South Africa]
09:00-10:30 REFORl'1ING FINANCIAL l\tIARKETS INSUB-SAHARAN AFRICA
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Chair: Dr. Andrew Bvumbe [UniversityofZimbabwe]
Rapporteur: Dr. Polycarp Musinguzi [BankofUganda, Uganda]
Presenter: Prof. Samuel Ziorklui [Howard University, USA], The ImpactofFinacial Sector
Reformon Bank Efficiency and Financial Deepening for Savings Mobilization in
Ghana
Presenter: Prof. Sam Ziorklui [Howard Univ., USA], The Development ofCapital Markets
and Gro\\1h in Sub-Saharan Africa
Discussant: Dr. Eric Nelson [DAI, USA]
09:00-10:30 AFRICAN TRADE AND INVESTl\'IENT IN RELATIONTO THE
GLOBAL ECONOlVIY
Chair: Dr. Fred Opio [EPRC, Uganda]
Rapporteur: Dr. Abdoul Barry [AIRD, USA]
Presenter: Prof. Margaret McMillan [lBI, USA] and Dr. Marios Obwona [EPRC, Uganda],
Foreign and Local Investment in Africa
Discussant: Prof. Germina Ssemogerere [UniversityofMakerere, Uganda]
Presenter: Ms. Lynn Salinger [AIRD, USA], TransshipmentofTextiles and Clothing
o Through Africa
Discussant: Dr. Daniel Ndlela [Zimconsul(Zimbabwe]
10:30-11:00 Coffee Break
09:00-10:30 ELECTRICITY TRADEINTHE SOUTHERN AFRICA PO\VER POOL
Chair: Dr. \Villiam Lyakurwa [AERC, Kenya]
Rapporteur: Prof.Dominique Njinkoll [AERC, Kenya]
Presenters: Prof. \Villiam Masters [Purdue University, USA] and Mr. Ferdi Kruger [ESKOM,
South Africa]
Discussants: Prof. Rob Davies [University ofZimbawe]
Prof. Inyambo Nlwanawina [UniversityofZambia]
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11:00-12:30 FINANCIAL INTER1\1EDIATION FORTHE POOR
Chair: TBA
Rapporteur: Prof. Margaret McMillan [IBI, USA]
Presenters: Dr. Hamed Ndour [REMIX, Senegal], Dr. Mohammed Karaan [Universityof
Stellenbosch] and Dr. Eric Nelson [DAI, USA] Financial Intermediation for the
Poor in Senegal and South Africa
Discussant: Dr. Fred Opio [EPRC, Uganda]
12:30-14:00 Lunch
FRIDAY, FEBRUARY6, PM: SUMIUARYAND COiVCLUSIONS
14:00-15:30 SUMlVlARY OF PARALLEL SESSIONS AND CLOSURE OF
\VORKSHOP
15:30-16:30 GLOBAL TRADE ANALYSIS SOFT\VARE DEl\10NSTRATION
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Demonstrator: Prof. William Masters [Purdue University, USA]
16:00-19:00 MEETING OFRESEARCH TEAMS \VITH EAGERffRADE
TECHNICAL COMMITTEE
SATURDAY, PEBRUARY 7: MEETING OFRESEARCHTEAfr/S JVITH
EAGERITRADE TECHNICAL COi}/fr/ITTEE
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Report Folder "A"
Papers and Reports from South Africa Workshop
EAGER WORKSHOP REPORTS, JOHANNESBURG, SOUTHAFRICA
February 4-6, 1998
1. Bringing Down Barriersto Trade: The Experience ofTrade Policy Reform byJeffrey
Metzel andLucie C. Phillips
o 2. Foreignand LocalInvestment inAfrica: Case Study ofUganda byMarios Obwona
..,
Foreignand Local Investment: Case Study ofMauritius byDr.·LlIcie Phillips. Marios
.J.
Obwona andA. B. Ayako
4. Gemstone and Gold Marketing for Small Scale Mining in Tanzania: Final Report for
Phase1
5. Lessons from EastAsia for Promoting Trade InAfrica: Survey Paper byKaren Engel
6. Monetary Exchange Rate Policy in Uganda:AnInterim Report byPolycarp Musinguzi
andMarios B. Obwona
7. Modeling ElectricityTrade in SouthernAfrica: Interim Progress Report byF.T. Sparrow,
WA. }.fasters. Z.Yli. B.H Bowen
o
8. NewTradeOpporturtities ForAfrica byLynnSalinger. AnatoliAmvouna. Deirdre
Murphy Savarese
()
9. Pursuing The Africa drowthand Opportunity Act: Countering the Threat ofTextile and
Apparel Transshipmentthrough Africa by. B. Lynn Salinger. AbdoulBarry. Selina
Pandolfi
10. The Political Economy ofTrade Policy Reform: Exploring An African Paradigm byDr.
Lucie Colvin Phillips
11. Regional Integrationand Cooperation in Sub-SaharanAfrica: Are Formal Trade
Agreements the Right Strategy?BySteven Radelet
12. SahelianWest Africa: Impact ofStructural Adjustment Programs onAgricultural
Competitiveness and Regional Trade byAbdoulBarry. B. Lynn Salinger. Selina Pandolfi
13. Statistical Analysis ofForeignand Local InvestmentbyMargaretMcAfillan
14. Trends inAfrican Trade: SurveyPaper byAbdoulBarryandNdaya Beltchika
15. Trade and Development inAfrica byJ. DirckStryker
16. The Uruguay Round And Africa: A Global General EquilibriumAnalysis by Thomas W
Hertel,William A. Masters andAzizElbehri
17. The WTO Agreement and Financial Services inAfrican Countries: AReview ofPolicy
and ResearchIssuesbyMichaelJ. Isimbabi
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USAID
EQUITY AND GROWTH THROUGH ECONOMIC RESEARCH
TRADE REGIMES AND GROWTH
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BRINGING DOWNBARRIERS TO TRADE:
THE EXPERIENCE OF TRADE POLICYREFORM
Jeffrey Metzel with Lucie Colvin Phillips
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Draft,January 30, 1998
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INTRODUCTION
Formost countries ofSub-Saharan Africa (SSA), self-sufficiency, nationalization, and
centralization were priorities ofpolicyfor most ofthe seventies andeighties. Bythe·earlyeighties,
substantialempirical.evidence hadaccumulatedto demonstrate that in comparison to more outward
orientedandliberal economies, these "statist" economic policies had been at the expense of economic
growth (Bhagwati, 1978;Krueger, 1978;Balassa ,1980; Dollar, 1992). This realization brought about
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aperiodofreforms, undertaken usuallythroughWorldBanksponsored "structural adjustment"
programs, which stressedliberalizinginternal markets andtrade, promotingprivateinitiative and.
investment, anddecentralizingpower. Theseprogramswere expectedto bring about substantial
improvement in trade performanceas well as economic growth.
Howeve~,exporttrade from SSAcontinuedto fall as ashare ofworldtrade between 1985 and
1990, and overthe sameperiodreal export earningswere eitherstagnant or fell for 25 of33 countries
inthe region (Svedberg, 1991). Between 1990and 1994, annual export andimport growth has been
positive (1.9% and2.1% respectively), butsubstantiallylessthan population growth for the SSA
, •
region andonlyeight countries out of39 showedhealthyexport growth (> 5%) overthe period
(Barry·andBeltchika, 1996). Whilethis poorperformanceis blamedon avarietyofinternal and
externalfactors, there is an increasingconsensus that alarge share ofthe blame must stillbe placedon
the.economicpolicyenvironment.
Thissurvey·examines theliterature ontrade policyreformin Africainthe past decade, and
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