Trade and industrial policy on an uneven playing field: the case of the deciduous fruit canning industry in South Africa

摘要

It is noted that the deciduous fruit canning industry (DFCI) is a resource and labour-intensive industry with a high trade ratio. It offers the prospect of being a significant source of employment and export earnings for a number of southern hemisphere countries that enjoy a considerable comparative advantage. Market distortions severely constrain this outcome, however, most importantly a combination of protection and subsidies in the industrially advanced countries. In addition, as in other sectors, globalization is increasingly associated with processes in which value-added activities are located in the major markets of the industrialized countries. The paper examines the DFCI (and in particular canned peaches) in South Africa and explores the consequences of market distortions and the shifting location of profitable activities for both industrial and trade policy in that country.