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South African quotas on textile imports from China: A policy error?

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  • Naudé, Wim
  • Rossouw, Riaan

Abstract

In August 2006 the South African government announced quotas on the imports of clothing and textile products from China. Three questions arise. What are these expected benefits? What will be the most likely impact of the import quotas on the South African economy? And what are the policy implications? In this paper we answer these questions by using a computable general equilibrium (CGE) model. We find that, contrary to the motivations apparently underlying the quota implementation, the macro-economic, sector and household effects are negative and result in greater inequality between poorer and richer households. We refer to modeling results elsewhere in the literature which report results consistent to ours. The policy implications are that the imposition of these quotas could come to be seen as a policy mistake, and that South Africa may benefit more from considering a free trade agreement with China.

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  • Naudé, Wim & Rossouw, Riaan, 2008. "South African quotas on textile imports from China: A policy error?," Journal of Policy Modeling, Elsevier, vol. 30(5), pages 737-750.
    • Handle: RePEc:eee:jpolmo:v:30:y:2008:i:5:p:737-750
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    1. Xianhua Wu & Yingying Wang & Lingjuan Yang & Shunfeng Song & Guo Wei & Ji Guo, 2016. "Impact of political dispute on international trade based on an international trade Inoperability Input-Output Model: A case study of the 2012 Diaoyu Islands Dispute," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 25(1), pages 47-70, February.
    2. Wim Naudé & Riaan Rossouw, 2011. "Export diversification and economic performance: evidence from Brazil, China, India and South Africa," Economic Change and Restructuring, Springer, vol. 44(1), pages 99-134, April.
    3. Lila J. Truett & Dale B. Truett, 2010. "New Challenges For The South African Textile And Apparel Industries In The Global Economy," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 35(4), pages 73-91, December.
    4. Wu, Xianhua & Guo, Ji & Song, Shunfeng, 2023. "Influence of international trade disputes on the world industrial economic system based on inoperability input-output model," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 787-803.

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