Overview of South African Trade by bloved

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									1. Introduction

Since the formation of the World Trade Organisation (WTO) in 1994, the world‟s civil
society has begun to mobilise against what they perceive to be an unjust, power-based
and undemocratic trade regime. The WTO has become a symbol of perpetual inequality
on a world scale, and massive demonstrations have taken place during the various
Ministerial meetings of the WTO, to protest against the negotiations that activists insist
are the basis for continued socio-economic discrimination against poor people, especially
in the South. The first major event took place during the Seattle Ministerial in 1999,
where tens and thousands of civil society activists from all over the world completely
disrupted the meeting. This became one of the starting points for a new world movement
of organisations that link together and organise protests in order to put pressure on their
governments, businesses and international financial institutions. Bringing together
church-based groups, trade unions, environmental and women‟s organisations, left-wing
political parties and other social justice formations, the WTO protests serve as one
common mobilising point for everyone demanding a more equitable world order.

In South Africa, civil society has been part of these protests, and has simultaneously
engaged its own government to adopt more developmental-friendly trade policies. As
representatives of civil society testify in this paper, little has been achieved in terms of
impacting upon the government‟s overall approach to trade negotiations. However, the
relationship between civil society involved in trade issues and the government is not
uncomplicated, and the two cannot be simplistically put in an oppositional or adversarial
position vis-à-vis each other. Much of civil society‟s role, according to several of the
interviewees, is to provide resources and guidance to government to enable it to approach
trade negotiations with a developmental agenda. Where this fails, however, the civil
society organisations of this study feel it is necessary to pressure government through
campaigns and other more oppositional means, in order to advance its demands.
Government, on the other hand, feels, in theory at least, that civil society is an important
and valuable resource and can at times be a useful partner, according to Deputy Minister
of Trade, Rob Davies who was interviewed for this study. However, he points out,
government is also constrained by the international trade regime and the pressures placed
on it by powerful private economic interests. The need of government to balance business
demands and developmental necessities sometimes puts it on a collision course with civil
society, which has a more homogeneous constituency to defend: the poor and
underdeveloped part of South Africa.

This study has looked at the attitude of South Africa‟s civil society organisations towards
the government‟s trade negotiation structures and the ideology behind its trade positions.
Nine representatives drawn from non-governmental organisations (NGOs) and trade
unions have been questioned about the transparency, inclusiveness and developmental
approach of South Africa‟s trade strategies, and their responses are presented below.

This research is intended to give an indication of what civil society thinks the problems
are with the present approach to trade issues and provide some ideas of what could or
should change. It is important to note that even the developmental, social justice part of

civil society that does work around trade is not in total agreement on all issues. Some has
a more uncompromising view of the government‟s trade strategies and ideology than
others, and there is a difference in the form of engagement that the organisations have
with the government. What does bind them together, though, is the view that it is
necessary for civil society to participate in and to influence the government on its trade
positions. As civil society rests on notions of democratic inclusion and social justice, it
feels that its involvement is a part of forwarding the democratic rights and socio-
economic needs of disadvantaged people, and as such it is necessary for the deepening of
democracy that it can inform and steer trade negotiations.

A few ideas that can strengthen the influence of civil society are presented in the end of
the study, and come from the representatives of the sampled organisations. These ideas
are often framed as helpful suggestions that assume that government has an open attitude
and is willing to listen and compromise, and implies that civil society itself is prepared to
cooperate when possible – but also put pressure on government when necessary, when
such openness is lacking. Even though civil society still feels it needs to fight for more
space and more inclusion in trade negotiations, it is aware that no trade negotiations will
take place without government, and as such it is necessary to engage constructively.

For the purpose of this study, the term “civil society” connotes non-profit organisations
only and excludes business and other for-profit organisations from its definition. It refers
to the democratic, developmental civil society organisations that strive for social justice
and inclusion.

2. Methodology

This study has mainly used primary sources for the sections on South Africa‟s trade
patterns, policies and trading partners. Most data are drawn from the government‟s or the
Department of Trade and Industry‟s (DTI) websites, though some newspaper articles
have also been consulted. In this regard, the Business Day has been the most useful
secondary source.

For the section on civil society and its views, 9 organisations have been queried through a
questionnaire either on a face-to-face level or via e-mail. The questions have probed the
organisations‟ objectives as well as their attitudes towards the government‟s trade
positions and structures. Telephonic interviews have been made with Rob Davies, the
Deputy Minister of Trade and Industry, and with staff of NEDLAC, to probe official
attitudes and the processes that are in place to facilitate trade negotiations.

All representatives of civil society were drawn from organisations that belong to the
developmental, social justice and democratic part of civil society that opposes or tries to
alleviate the effects caused by capitalist globalisation on different sectors, and that is
active and prominent in engaging with trade issues in South Africa, through research,
campaigns and education. No representatives of business or other profit-making
organisations were sampled. All organisations represented here belong to the Trade

Strategy Group (TSG), which aims at bringing together social justice based organisations
to strategise for a stronger and more influential role in South Africa‟s trade negotiations.

The interviewed organisations were selected as they all are or have been involved in trade
issues on some level. They all represent social justice and democratic values, though their
activities differ, as do their constituencies and core issues: the aim was to draw a variety
of views from activists that come from different backgrounds, be it environmental,
religious, gender-based or class-based organisations.

South Africa is placed right at the bottom on the African continent and is bordering both
the Atlantic Ocean as well as the Indian Ocean. To the north, it borders Namibia,
Zimbabwe, Botswana and Mozambique. In 1994, South Africa‟s first democratic
elections were held, and ever since, the African National Congress (ANC) has been the
largest party in parliament and government. Nelson Mandela became South Africa‟s first
democratically elected president, and was succeeded by Thabo Mbeki in 1999. Its
executive capital is Pretoria, though parliament is placed in Cape Town. South Africa has
11 official languages. There are over 450 registered trade unions in South Africa, with the
Congress of South African Trade Unions (COSATU), the National Council of Trade
Unions (NACTU) and the Federation of Unions of South Africa (FEDUSA) being the
largest federations. COSATU is the main federation, with 22 member unions that
organises around 1, 8 million members. COSATU is also included in a tripartite alliance
with the ANC and the South African Communist Party (SACP).

3. South Africa’s Socio-Economic Context

In 1996, two years after the first democratic elections, the ANC government adopted the
Growth, Employment and Redistribution strategy (GEAR) as its macro-economic policy.
GEAR was implemented in order to try to rectify the problems of the South African
economy at the time: falling profits, little or no growth, and massive socio-economic
divisions as a result of apartheid. GEAR exhibits many characteristics of a neo-liberal
programme, as it is based on principles such as minimised state spending, labour market
flexibility, an export-directed economy and liberalisation. Relaxing exchange controls
and lowering tariffs are concrete measures implemented under GEAR.1 Being introduced
as “non-negotiable”, GEAR replaced the more developmental-based and democratically
negotiated Redistribution and Development Programme (RDP) despite heavy opposition
and criticism even from the ANCs tripartite alliance partners, COSATU and the SACP.
The neo-liberal paradigm is influencing much of South Africa‟s economic policy-
making, writes one of South Africa‟s most prominent trade activists2, and the neo-liberal
basic tenets of GEAR inform government‟s trade policy and negotiation positions,
according to many trade activists.

Between 1994 and 2004, South Africa had an average growth of 3 per cent, reaching 5
per cent in 2005.3 However, while foreign capital inflow into South Africa has been

“exceptionally high” since 2003, reaching R80 billion (about US$13 billion) between the
beginning of 2005 and the first quarter of 2006, the trade deficit of South Africa was 4, 3
per cent of GDP in 2005. 4 One of the main reasons behind this deficit, according to
government, is the strong currency, which puts constraints on exporters.5 Also, the large
foreign capital investment during this period was to a large extent due to the acquisition
of ABSA by Barclays Bank, which the government before the deal was even sealed
predicted would “represent the single biggest foreign direct investment in South Africa
since the 1994 elections”.6 In order to reach the desired growth rate, the government
introduced the Accelerated and Shared Growth Initiative of South Africa (AsgiSA) in
2005. AsgiSA is not a diversion from the macro-economic programme of GEAR, but
rather a series of initiatives that the government will embark upon in order to reach a few
objectives, most importantly halving the unemployment rate by 2014 and halving the
poverty rate to less than one-sixth of households. In order to reach these objectives, the
government has concluded that an average growth rate of 5 per cent per year between
2004 and 2014 is necessary, and opportunities for more labour-absorbing economic
activities must be created. AsgiSA measures include a slight increase in public sector
investment, much of which will go to improving infrastructure, and the attraction of more
tourism and back-office jobs such as call centres. Education and skills development,
elimination of the second economy, and stabilising the currency, are other features of

One of the major problems of South Africa is its high unemployment. While there has
been economic growth, few jobs have been created, while many, especially in the
clothing and textile industry, have been shed. Around 8 million people, or 40 per cent of
the economically active population (according to the broad definition of unemployment,
which takes into account people who have not attempted to look for work in the month
before they were identified as unemployed) are unemployed in South Africa.8 On
average, every worker supports at least five other people, and 66 per cent of workers earn
below R2 500 per month.9 While structural unemployment has always been a feature of
South Africa, it is after 1994 that the unemployment in South Africa began to sky-rocket,
and the government‟s trade policies is partly to blame, according to some trade and
developmental activists:

Together with privatisation and increased competition from foreign firms, now able to freely trade in South
 Africa, local corporations restructured (often retrenching workers) so as to be more competitive and cost
effective. This resulted in introduction of new technologies that also replaced people‟s jobs. From 1994 to
2002 more than one million jobs were lost and unemployment rose to over 40%. Huge job losses coincided
    with the introduction by the government of cuts in spending, trade liberalisation and privatisation. 10

4. South Africa’s Trade Policy

According to the present Minister of Trade and Industry, Mandisi Mpahlwa:

South Africa is a strong proponent of multilateralism. This is a fundamental principle of our foreign policy
                                     and central to our trade policy. 11

One approach of the South African government to the multilateral system, has been to
work closely with multilateral institutions and to reform them to gain more influence by

developing countries, according to the present Minister of Trade and Industry, Mandisi
Mpahlwa.12 South Africa must actively participate in and seek to change the multilateral
fora that exist “in a manner that supports our development and integration into the global
economy”, the Minister maintains.13

The main problem with this model, according to some trade activists, is that it has in
many other African countries led to the adoption of export-led growth models in their
own countries.14 “This model has been „autonomously‟ implemented in SA over the past
decade – with increasingly questionable effects upon the broader production economy, on
internal policy decisions, on employment generation and on tackling the growing poverty
in this country; which have all been exacerbated [by] these trade policies. Yet SA trade
officials, and others, continue to refer routinely to South Africa‟s commitment to „the
multilateral trade system‟ as if it is a self-evident fact and almost an objective and largely
immutable given”, comments Dot Keet of the AIDC.15

Furthermore, the government considers development as key to economic growth on a
global level, and therefore supported the Doha Development Round of negotiations.
Before the 6th WTO Ministerial Conference in Hong Kong, the government concluded
that the overall aim should be to ensure that the Doha objectives be “translated into
reality as soon as possible”.16

Another view of the government is that open economies with an export base provide the
best opportunities for achieving economic growth, and as South Africa‟s global economic
strategy is based on sustainable growth, “dismantling barriers to trade, especially those
barriers faced by South African exporters, is a critical component of any economic
strategy that promotes sustainable growth.”17 An important feature of South Africa‟s
general trade policy is commitment to lower its tariffs and phase out non-tariff barriers.
Organised labour saw early on in the new democracy the problems these reductions could
lead to: “Tariff reduction without supporting policies in affected sectors leads to job
losses. An immediate moratorium on any further reductions should be imposed…Tariffs
should not be reduced at a rate faster than required by our obligations to the World Trade
Organisation. Where this has occurred and has resulted in job losses, tariffs must be
increased to the obligatory rate”, said COSATU in 1998.18 According to a 2005 study by
the DTI, The Textile Sector of the South Africa as Evaluated Through the dti Gravity
Model, the main decrease in South Africa‟s tariffs took place between 1994 and 1995,
with the steepest reductions applied in the textiles and clothing industry sector.19

South Africa was a founding member of the General Agreement on Tariffs and Trade
(GATT) in 1947, and is a member of the World Trade Organisation (WTO). The official
position of the government is that “…it is imperative for South Africa to influence and
shape the configurations of the emerging system of global governance to address the
needs and concerns of the developing world. This is best done by participating actively
and effectively in all multilateral fora, to ensure that its particular economic interests and
developmental goals and objectives, as well as those of the African continent, are taken
into account”.20 South Africa considers is membership in the WTO as “very important”
and it “cannot afford not to be in the WTO” as the organisation “provides a transparent,

fair and predictable rules-based trade system that gives its members the choice in their
imports and exports, and provides valuable guide lines for trade policy”.21 South Africa
has some clear positions that were presented to the WTO in Geneva in 2006: developed
countries must reduce their farming subsidies as well as their agricultural tariffs without a
counter demand that developing countries reduce their industrial tariffs.22 Minister
Mandisi Mpahlwa further suggested, in a 10-point programme, that the G8 countries
should implement duty free and quota free access for all products from the least
developed countries, without demanding reciprocity. He also proposed measures to make
temporary movement of African workers and outsourcing easier, to facilitate the export
of African services into the developed world. A review of WTO from a development
perspective should take place, as well as the implementation of a special flexibility for
African countries not to apply certain rules, are other proposals of the proposed 10-point

South Africa is a member of several economic and cooperative organisations, such as the
G-20 ( also known as the G-20+) and the Cairns Group, which cooperate around issues
specific to developing countries in order to strengthen their presence in the WTO.

The G-20 was formed in August, 2003, and consists of developing countries that came
together before the Fifth WTO Ministerial in Cancun to strengthen their position in the
negotiations on agriculture. Since then, the group has consolidated and become a well-
recognised institution. Its main focus is to ensure that the Doha Development Agenda is
respected. The membership of the G-20 fluctuates as countries withdraw from or join the
group, but in 2006, its website reported that there was 21 members, five from Africa, 6
from Asia, and 10 from Latin America.24

The Cairns Group is a coalition of 18 agricultural exporting countries that argues for the
liberalisation of trade in agricultural exports. The Cairns Group includes countries from
both the developed and the developing world, and has as its main aim the achievement of
free and fair trade. Some trade reforms the Cairns Group is pushing for are significant
tariff reductions, the removal of agricultural domestic subsidies that distorts trade, and
clear rules that can prevent the evasion of export subsidy commitments.25

South Africa is also part of several bilateral and regional partnerships with other African
countries. SACU – the Southern African Customs Union – is the world‟s oldest
customs union. In 1910, the Customs Union Agreement was signed. This agreement was
replaced with the signing in of another Customs Union Agreement, which came into
force on 1st March, 1970.26 SACU consists, besides South Africa, of Botswana, Lesotho,
Namibia and Swaziland. Free trade takes place between the members of SACU, and the
Union has one common external tariff and one system for collecting and sharing customs
duties.27 South Africa is similarly a member of the Southern African Development
Community (SADC) since 1994. SADC consists of 14 countries in southern Africa, with
its headquarters in Botswana. In 1992, SADC was transformed from a loose alliance in
the form of a Coordinating Conference into a Development Community, and has been
described as a “long-term multilateral development project based on cross-border
cooperation in all aspects of the economies and societies of the member countries”.28

SADC is a regional integration body aiming at cooperation to develop the southern
African region economically, socially and politically.29 In January 2000, the SADC
Protocol on Trade came into force. As agreement was reached on Protocol issues such as
tariff-reduction schedules, elimination of non-tariff barriers, and harmonisation of
customs and trade documentation, a SADC Free Trade Area was launched on 1
September 2000, to be established by 2008.30

South Africa further belongs to the Indian Ocean Rim Association for Regional Co-
operation (IOR-ARC); the Common Monetary Area (CMA); the African Union
(AU); the United Nations Cooperation for Trade and Development (UNCTAD); the
Non-Aligned Movement; the World Bank; and the International Monetary Fund

Special Case: South Africa’s Textiles and Clothing Industry

The textiles and apparel sector in South Africa is of high importance, as it is the sixth
largest manufacture employer and the eleventh largest exporter of manufactured goods.32
Between 2001 and 2004, the average growth in real exports from this sector grew by 10,
6 per cent.33 However, the average growth of job opportunities in the sector during the
same period was 0 per cent, with more than 43 500 jobs being cut between the beginning
of 2003 and mid-2005.34 In mid-2005, it was reported that since 1996, more than 75 000
jobs has disappeared from the clothing, textile, footwear and leather industry in South
Africa: “The main cause of this is the fact that a large and rapidly growing percentage of
the products sold in South Africa are imported, mainly from China.”35 Between 2002 and
2004, Chinese clothing imports by South Africa increased with 335 per cent, and in 2004,
74 per cent of the value of South African clothing imports came from China.36 The
reasons most often quoted for this increase in imports are several, including a
strengthening of the South African Rand as well as rapid liberalisation.37 The significant
liberalisation and tariff reduction in this sector “has generated intense import competition
across all of the textile sub-sectors”.38 Besides a negative impact on the social structure as
a whole, these lay-offs hit women particularly hard, as 66, 1 per cent of all textile and
clothing employees are women, of whom a large majority are Black: “This situation
means that job losses in the industry have a disproportionate impact on women and
women-headed households.”39 As a comparison, only 33, 2 per cent of all workers in the
rest of South Africa‟s manufacturing sectors are women.40 Given South Africa‟s high
unemployment rate, it is calculated that every clothing and textile industry workers
supports five other people. With the job losses between 2003 and the first half of 2005,
about 217 940 people were affected by the loss of income.41

Because of the competition from Chinese textile and clothing products and its effects on
the employment rate in the sector, unions are calling for protectionist measures against
Chinese clothing and textile imports in the bilateral trade talks between South Africa and
China,42 while an agreement between the South African Department of Trade and
Industry and Chinese officials seeks to limit Chinese clothing and textile exports to South

Africa with as much as 30 per cent over three years.43 China and South Africa have
begun to deepen their trade and development relationship, through recent visits to South
Africa by senior Chinese officials, and the signing of the Programme of Cooperation and
Strategic Partnership agreement, after having established diplomatic ties in 1998.44 This
agreement is meant to promote and expand exchanges and cooperation in all areas:
cultural exchange programmes will be put in place, technological and investment
cooperation in areas such as mining is encouraged, as is bilateral exchanges in the area of
public health and medical science, and trade is to be encouraged from both sides.45 China
will furthermore provide assistance to the AsgiSA through human resources

5. Overview of South Africa’s Trade

In 2003, South Africa‟s exports amounted to more than its imports. However, the balance
of trade started to decline in 2003, and by 2004, South Africa imported more than it
exported. In 2005, South African exports amounted to almost R331, 5 billion, while its
imports amounted to R351, 6 billion (see Table 1).47

South Africa‟s most important natural resources include gold, coal, platinum and iron
ore, as well as fish and an abundant wildlife. The economic sectors of South Africa are
divided into agriculture (3, 8 per cent), industry (31 per cent) and services (65, 2 per
cent).48 Between the years 2000 and 2004, South Africa‟s share of the world‟s exports
increased from 0, 47 per cent to 0, 5 per cent, while its share of world imports increased
from 0, 44 per cent to 0, 58 per cent, with the most significant increase taking place in
2003, when the figures rose from 0, 44 to 0, 53 per cent.49 Its average annual growth of
exports rose from 6, 44 per cent in 2000 to 6, 77 per cent in 2004, with the biggest dip
going down to 6, 17 in 2002. This is slightly below Africa as a whole, which had a
growth of 7, 04 per cent in 2000, increasing to 7, 36 per cent in 2004.50

The largest South African imports (in 2004, as part of the world‟s imports) are cereals
(1, 1 per cent of world imports), animal and vegetable oils, etc. (1, 0 per cent of world
imports), inorganic chemicals, precious metal compound, etc. (1, 2 per cent of world
imports), explosives, pyrotechnics, matches, etc. (0, 9 per cent of world imports), and
fertilisers (0, 8 per cent of world imports). Mineral fuels, oils, distillation products and
similar account for just above 14 per cent of South Africa‟s total spending on imported

In 2004, South Africa was the world‟s number 1 exporter of platinum, nickel (plates,
sheets, strip and foil) as well as of chemical wood pulp (dissolving grades).52 Other major
exports are citrus fruit, wine of fresh grapes, centrifuges and coal products.53 In terms of
services, travel/tourism in South Africa accounts for 0, 9 per cent of world exports.54

Table 1: Total Trade, South Africa (2000-2005)

                                  Total Trade South Africa
   Billions (Rand)




                     200                                                   EXPORTS
                     150                                                   TRADE BALANCE




                     -50   2000   2001   2002   2003    2004    2005

Source: http://www.thedti.gov.za/econdb/raportt/raptottr.html

6. South Africa and Its Trading Partners

The European Union (EU) is South Africa‟s biggest trading partner, providing South
Africa with almost half its foreign trade.55 In 2003, 40 per cent of South Africa‟s total
exports went to Europe, while 45, 8 per cent of its imports came from this continent, with
the EU accounting for the main part of the trade.56 In 1999, the EU and South Africa
signed a free trade agreement – the Trade, Development and Co-operation Agreement
(TDCA) – which will remove 90 per cent of all trade barriers over ten years.57 Of the
countries in the EU bloc, the United Kingdom is South Africa‟s most important trading
partner and largest European export destination. It is also South Africa‟s third largest
trading partner overall.58 Important imports from European countries, most notably
Germany, the United Kingdom, France, Ireland, Finland and Italy, are electrical
equipment. Together these countries account for 37 per cent of South Africa‟s overall
import of electronic products.59 In turn, much of South Africa‟s fruits, nuts and similar
products go to Europe: 65 per cent of this export ends up in European countries.60

The USA is the biggest single trading partner of South Africa (in 2003), and US exports
much more to South Africa than to any other country in Sub-Saharan Africa. South
Africa falls under the Africa Growth and Opportunity Act (AGOA), which provides for
duty-free access of exports into the US for about 1 800 product lines, or 94 per cent of
South African exports; South African exports under AGOA increased from US$923
million in 2001 to US$1, 3 billion in 2002.61 There are long drawn out negotiations
around a free trade agreement between the USA and SACU, which have been stalled
several times due to “different approaches to key issues”, according to South Africa‟s
chief trade negotiator, Xavier Carim.62 The USA wants SACU to sign up for a
comprehensive free trade deal, which includes not only trade in goods and services, but

also agreement on issues such as investment and intellectual property rights. However,
SACU – though being the oldest customs union in the world – still does not have uniform
or harmonised trade policies on these issues, as the different countries in the union have
“vastly disparate levels of trade policy negotiations”.63 While the talks were supposed to
be concluded by the end of 2004, no new deadline for conclusion of the talks has been
set.64 In the place of the free trade agreement, the USA proposed in April 2006 the
adoption of a Trade and Investment Cooperation Agreement (TICA) to guide trade
relations. While South Africa‟s chief negotiator Xavier Carim said that his initial sense of
the TICA was “good”, SACU as a group is yet to respond to the proposal.65 What the
TICA actually includes, and how it differs from the failed free trade agreement, is not
clear to actors outside of the DTI, according to the Trade Strategy Group.66

The Middle East, and especially Saudi Arabia, Iran, Israel, the United Arab Emirates and
Turkey, has increased its trade exchanges with South Africa since 1994, making up 7, 5
per cent of South Africa‟s total international trade in 2001.67 The many bilateral
agreements South Africa has concluded with countries in the region cover areas such as
civil aviation, taxation and protection of investments.68 As South Africa purchases a large
percentage of its oil from Saudi Arabia, there is a great trade deficit in favour of Saudi
Arabia: in 2003, exports to Saudi Arabia from South Africa stood at R1, 2 billion, while
imports amounted to R15 billion.69 35 per cent of all mineral fuels, oils, distillation
products and similar is imported by South Africa from Saudi Arabia. 34 per cent of these
products are imported from Iran.70 Israel was in 2003 South Africa‟s main export
destination in the Middle East; this year, exports to Israel amounted to R4 billion.71

In Asia, SACU is pursuing a free trade agreement with India, which is a major trade and
economic cooperation partner for South Africa. Total trade between South Africa and
India reached R6, 5 billion in 2003, and increased with 133 per cent between 2001 and
2005.72 South Africa and India also cooperate in many economic and trade areas, such as
the India-Brazil-South Africa Forum, and cooperate in areas of common interest in
structures such as the WTO and the G-20.73 Japan is South Africa‟s largest Asian trading
partner, its third-largest export destination (2003), and its fourth biggest overall. South
Africa‟s exports to Japan consist primarily of commodities, especially minerals, while
imports are made up of manufactured products, in particular cars and electronic goods.
Japan is also an important investor in South Africa, investing mainly in the minerals
processing and automobile and related sectors.74

The relationship between China and South Africa has seen South Africa importing much
more than it exports: in 2004, South African exports to China amounted to R5, 5 billion,
while imports reached the amount of R18 billion, and in 2005, this pattern was still
visible, as China‟s imports to South Africa was worth R23 billion more than South
Africa‟s exports to China.75 In 2005, total bilateral trade between China and South Africa
amounted to US$7, 2 billion (approximately R109 422 4924 – sorry, very confused here!
The exchange rate = 6, 58, please double check that I calculated correctly! Thanks!),
which is a fourfold increase since 2000.76 In the main, Chinese exports to South Africa
consist of manufactured goods, such as appliances and clothing, while South Africa
exports mainly minerals, largely iron ore, copper, chrome, as well as timber and paper

pulp; in 2005, 73 per cent of all South African exports to China came from the minerals
sector.77 Negotiations between SACU (the Southern African Customs Union) and China
were scheduled to begin in 2006, aiming at the signing of a free trade agreement, though
trade unions have been opposed to this move and DTI officials have begun to consider a
different kind of agreement: “We want to do something specific to China. Because of the
imbalances you wouldn‟t do a classical free trade agreement; there is concern about being
overwhelmed, which is probably legitimate”, commented the DTI Director-General
Tshediso Matona recently.78

MERCOSUR (or MERCOSUL in Portuguese) stands for the Southern Common Market
in English. This is a trade area in South America where goods, services and productive
factors are moving freely between the member countries Argentina, Brazil, Paraguay,
Uruguay, and Venezuela. Chile, Bolivia, Peru, Colombia and Ecuador are associate
members. In 2000, South Africa and MERCOSUR signed a framework agreement
committing the two trading partners to establish a free trade area and to continue
negotiations towards that goal. Trade between South Africa and MERCOSUR grew from
R2, 7 billion in 1994 to R10 billion in 2003. Of the Latin American countries, Brazil and
Argentina are South Africa‟s most important trading partners, with Chile becoming
increasingly important, especially in the mining sector.79 At the moment, MERCOSUR
and SACU are holding talks to reach an agreement on a preferential trade deal signed at
the end of 2004. MERCOSUR is looking for more access into areas sensitive to some
SACU countries, like the South African automotive industry and the beef and dairy
industries in Botswana. Concerns around this access are still being discussed.80

Trade with the rest of the African continent largely favours South Africa: in 2002, 16
per cent of South Africa‟s exports were directed to other African states, while only 4 per
cent of its imports came from the continent.81 The export-import ratio between South
Africa and SADC was then 8:1.82 In 2005, South Africa‟s imports from the rest of the
continent were 2 per cent of its total imports, while exports still stood at 16 per cent.83 In
July in 2006, SACU signed a free trade agreement with the European Free Trade
Association (EFTA), after seven rounds of negotiations. EFTA is a different trade group
from the EU, and consists of Iceland, Liechtenstein, Norway and Switzerland.84

Trade between South Africa and SADC doubled between 1998 and 2002, reaching R32
billion in 2002.85 Over R15 billion of South Africa‟s export earnings come from SACU
and other SADC countries.86 In 2003, Zimbabwe was the largest African importer of
South African goods, reaching R6, 5 billion, while South Africa imported Zimbabwean
goods worth R2, 6 billion.87

South Africa is the recipient of several preferential trade arrangements, where countries
unilaterally decide on lowering their tariffs and increase or remove quotas. The countries
that have granted South Africa preferential status are the EU countries, Norway,
Switzerland, Hungary, Japan, Canada, USA, and the Czech Republic.88

Table 2: Trade According to Wold Zones: Imports and Exports.

     Trade According to World Zones (July 2005)
                                                                    Trade According to World Zones (July 2005)
                            Africa                                               Oceania
                 Oceania     2%                                                    3%           Africa
                   2%                                                                           16%


                  America                                             12%

Source: http://www.thedti.gov.za/publications/statsQ3_2005.pdf

7. South Africa’s Civil Society

  Civil society in South Africa emerged in the context of the country‟s divisive history. It reflected in its
composition, constituencies, and target communities the racial divisions of firstly colonialism and secondly
the apartheid era, and the consequent isolation and disadvantage of communities, especially of the majority
                                             black population.89

Under apartheid, South Africa‟s civil society – which includes religious organisations,
community-based groups, trade unions, NGOs and other forms of private organisations –
was divided along „racial‟ and political lines. In a study over South Africa‟s non-profit
organisations (NPOs), Swilling & Russell write that most of 20th century apartheid saw a
“stable interdependence” between the state and racially exclusive NPOs involved in
sports, culture and service delivery activities.90 The state‟s approach towards Black NPOs
was “schizoid”: it repressed the oppositional organisations, while it often left the service-
oriented, apolitical NPOs in peace, thereby justifying its position that Black welfare was
not the White state‟s concern.91 It was civil society that provided the internal pressure on
the apartheid government to capitulate: political and democratic parties and movements,
trade unions, religious groups, and civics.

Once the democratic government was elected in 1994, the relationship between the state
and civil society changed. Under the aegis of the RDP, civil society (for this purpose

excluding business and other profit-oriented ventures) was assigned an important role as
a partner in development and service provision, and could provide checks and balances
on government. 1994 saw NPOs and the state entering a “non-racial, corporatist pact” 92
compounded by an extensive and potentially enabling legal framework. The Non-Profit
Organisations Act of 1997 states that the government‟s responsibility vis-à-vis NPOs is
that “…within the limits prescribed by law, every organ of state must determine and co-
ordinate the implementation of its policies and measures in a manner designed to
promote, support and enhance the capacity of NPOs to perform their functions”.93

The Act defines an NPO as “a trust, company or other association of persons established
for a public purpose and the income and money of which are not distributable to its
members or office-bearers except as reasonable compensations for services rendered”.94
Community-based organisations (CBOs), non-governmental organisations (NGOs) and
trade unions all fall under this definition. The purpose stated in the Act includes creating
an enabling environment for NPOs to flourish, establishing a regulatory framework for
the administration of NPOs, encouraging NPOs to maintain and improve standards of
governance, accountability and transparency and to “promote a spirit of co-operation and
shared responsibility within government, donors and amongst other interested persons in
their dealings with non-profit organisations”.95 The Act also provides a framework for the
funding of NPOs.96

While the legal framework is considered a positive and enabling step for NPOs, as it
promotes their fund-raising rights and protects them from abuse of power by the state,
and while the partnership between the state and NPOs is much more cordial and mutually
beneficial than under apartheid, the danger of cooptation by civil society organisations
and the closure of autonomous spaces outside of the direct influence of the state has been
highlighted as an unwelcome outcome.97

The introduction of democracy did pose new challenges for non-profit civil society
organisations. They have had to change from an oppositional relationship with the state to
a relationship of engagement and at times cooperation around issues of poverty relief and
social development.98 While this close connection between the state and civil society was
emphasised in the first few years of democracy, the introduction of GEAR saw a shift
where the private sector and profit-making organisations were considered more important
partners in making the economy grow and the delivery of basic services, while the NPOs
were allocated a strong role in the area of poverty alleviation.99 As is shown further
down, many of the representatives working in developmental NGOs are unhappy with the
business-orientated neo-liberal turn the government took in 1996. Furthermore, after the
first democratic election, there has been a significant brain-drain from non-profit civil
society organisations into parliament and the different departments of government.
Leaders from trade unions, NGOs, civics, have left the sphere of civil society creating a
“huge gap” in civil society leadership.100

South Africa‟s civil society is active and heterogeneous. It consists of numerous and
vastly different groups, networks and organisations that are based in communities and
working mainly with poverty relief with very little financial and human resources, or of

more professionalised NGOs, trade unions, social movements, religious groups, and
though significantly weakened after the fall of apartheid, there is still an existing civic
movement. It is difficult to estimate the number of non-profit civil society organisations
in South Africa, but an estimate has been made that roughly half consists of less
formalised, community-based NPOs with little resources.101

8. South Africa’s Civil Society and Trade

In the area of South Africa‟s foreign trade relations, the relationship between the
government and civil society has moved between “co-operation and participation to
exclusion and antagonism” in different periods.102 In the early period after the democratic
elections, under then Minister of Trade and Industry, Trevor Manuel, civil society, in the
form of NGOs, trade unions, academics and research organisations, was encouraged to
debate and discuss trade strategy like South Africa‟s involvement in the WTO and
regional trade cooperation. Under trade minister Alec Erwin (1996-2004), consultations
with civil society became more restricted, and more constructive debates faded. As a
result of these changing circumstances, coupled with a shift in emphasis in the
government‟s trade ideology, where the perception of Alec Erwin was that he „colluded‟
with the undemocratic WTO regime and undermined other African trade officials and
civil society activists, NGOs, religious groups, trade unions, women and environmental
organisations formed the Trade Strategy Group.103 In an analysis over the South African
government‟s approach to the WTO processes, a trade activist commented that the DTIs
public consultative conference, held in August 1999, just before the WTO Third
Ministerial, was “above all, largely a token exercise in popular consultation because of
the inadequate prior information and very limited knowledge of the issues even amongst
those people‟s organisations that were present.”104 The conference was not considered a
genuine attempt to take the views of civil society into account, as the DTI had already
before the conference made a decision regarding its overall strategic WTO Ministerial
approach, and even some specific negotiating positions; no real alternatives to the
determined line were seriously considered, nor was a shift in overall strategy.105 At this
point, business was the main focus of the DTI, and only a few NGOs and trade unions
had been invited.106

It has been argued that since Mandisi Mpahlwa succeeded Alec Erwin in 2004 as
Minister of Trade and Industry, the engagement with civil society has yet again begun to
open up and become more inclusive.107 While some civil society representatives of this
study do have a carefully optimistic view of the climate that surrounds trade debates and
considerations under the current Minister of Trade, many still feel that not only are the
workings of the WTO totally undemocratic and still power-based rather than rules-based,
but the South African government is also too far from being inclusive, transparent and
open to the views of civil society:

 First important thing that the government would need to do is to take civil society seriously on issues of
 trade. There are credible institutions in civil society itself with years of experience who can add value to
  what negotiators have to consider, but sad enough, in South Africa it is as if civil society does not at all

The main structure where civil society can engage government and business on trade
issues is the National Economic Development and Labour Council (NEDLAC).
NEDLAC is a forum for „social dialogue‟ where government, labour and business try to
reach consensus on socio-economic policies. It consists of a number of government
departments, organised business and labour groups and unions, and organised community
groups. The four chambers of NEDLAC are the Public Finance and Monetary Policy
Chamber, the Development Chamber, the Labour Market Chamber, and the Trade &
Industry Chamber. NEDLAC also plays the role of a dispute resolution body between
trade unions, government and/or business in issues regarding social and economic
policy.109 The NEDLAC structure where discussions and research around trade takes
place is the Trade & Industry Chamber. The Chamber has three convenors: one from
government, one from organised business and one from organised labour (in this case
COSATU).110 Community organisations and NGOs, while represented at the government
trade delegation, do not have a seat in the NEDLAC Trade and Industry Chamber.111 The
reason for this exclusion is not clear, even among the staff of the Trade & Industry
Chamber.112 There is a feeling among many community-based organisations and NGOs
that a space in the Chamber would be beneficial to the developmental sector, and the
Trade Strategy Group is discussing the prospect of including a representative from this
side, even if only observer status would be given.113

The Trade & Industry Chamber is further divided into sub-sections, the most important
for this purpose is the Technical Sectoral Liaison Committee (TESELICO). In
TESELICO, trade related social dialogue is taking place and includes discussions around
trade negotiations and WTO interaction.114 Report-backs are given every month from the
task teams that are assigned sectors like the WTO, NAMA, and other processes.115 The
issues that are discussed in TESELICO are usually tabled by the DTI, which forward the
discussion proposal to the convenors, who in turn submit names of participants to the
monthly meetings. According to NEDLAC procedures, all TESELICO participants may
submit any issue they want to discuss before a meeting, however, it is generally the
government that submits most suggestions for discussion.116 TESELICO does not
convene or coordinate any other discussion forums on trade, either public or closed ones,
outside of NEDLAC structures.117

Before the WTO Ministerials – Seattle in 1999, Doha in 2001, Cancun in 2003 and Hong
Kong in 2006 – the government convenes Consultative Conferences with civil society
and business. Here, actors other than government have a chance to lay forward their
views ahead of the WTO negotiations, after which government “must exercise judgment
in drawing together our developmental objectives, the variety of national views on these
complex issues and the possibilities and constraints elicited by the global
environment.”118 How consultative these conferences really are, seems to differ according
to who is in charge of them, as was shown above, but this consultative structure has
nevertheless become a “tradition”.119

While COSATU and different NGOs and community organisations do engage each other
through many bilateral meetings, joint workshops and protest actions and campaigns120, it

seems as if government is more interested in engaging with trade unions on a regular
basis. There is “significant interaction” taking place between government and trade
unions on an “ad hoc basis”, where information is exchanged and views are discussed.121
But one view from an NGO representative is that the NEDLAC trade and TESELICO
structures, while including the trade unions, are excluding the rest of civil society and is
not really interested in what the rest of civil society thinks:
  In most cases when they invite civil society, it is just before the Ministerial meetings, and then it‟s more
just to inform civil society. There isn‟t real hearings or trying to find out what civil society thinks about the
            negotiations. There isn‟t even a way of trying to inform the position of government. 122

This view is echoed in a study over South Africa‟s NPO sector which states that as NPOs
are not as centrally organised as trade unions, business and government, their presence in
NEDLAC is marginal: “Instead, NEDLAC has become a three-way policy negotiation
forum where the national government, organised business, and COSATU hammer out
corporatist agreements on a range of policy issues.”123 A trade union respondent agrees:

Civil society has no voice, or the community has no voice, at NEDLAC on trade. Organised labour does.124

The non-inclusion of community groups and NGOs in the NEDLAC Trade and Industry
Chamber has been highlighted by a couple of respondents as a weakness in their work on

While many civil society representatives interviewed for this report are aware of, and
sometimes participate in, the government‟s report-backs and briefing sessions regarding
its work on trade, mainly taking place just before Ministerial meetings125, they did not
think this amounted to substantial engagement and dialogue. When government and trade
officials do organise meetings with civil society, especially community organisations,
these tend to be very one-sided and the views of civil society are not taken into

I think there has been a conception from government that civil society tends to be interfering and critical of
                    government, so I don‟t really see a deep engagement on that level. 127

    …I would say, if one looks at least at the Hong Kong Ministerial, there was a deliberate effort from
 government to at least inform civil society about what‟s happening in the trade negotiations…I would say
that it shows there is a shift in government where they realise they need to consult with civil society. Or not
                        even consult, but to inform civil society about their positions.128

  I think [the government is] also confused abut the role of civil society post-1994, because we don‟t see
 much participation and also community involvement in some of the negotiations. I don‟t want to say even
consulted, but also the participation and the need for participating of community members and civil society,
                                 because that is lacking and is even dying.129

One trade unionist responded that government‟s support of civil society involvement in
trade negotiations, and its propensity to be influenced by civil society views was
“contradictory”: only when government‟s views converge with those of civil society is
space for genuine involvement and mutual exchange provided.130

The government, on the other hand, insists that it values the input of civil society. Rob
Davies, the Deputy Minister of Trade and Industry, does think it is important for civil
society to be involved in trade negotiations for mainly two reasons: first, the outcome of
the negotiations does have an impact on the constituencies of civil society groups, and
thus they have an interest in monitoring and trying to influence the negotiations. Second,
they also possess valuable experience and insights that the government can draw from,
and they are “uniquely placed” in different campaigns that makes demands and educates
around trade issues.131

The person most satisfied with government‟s approach to civil society was a high-ranking
representative of COSATU. COSATU is also actively involved in many levels of trade
negotiations. To start with, COSATU does research around specific goods and sectors
and make detailed recommendations about possible adjustments and concessions the
government can put forward in negotiations. These detailed discussions on line-by-line
issues take place in NEDLAC, in TESELICO.132

We then have a number of opportunities at a policy or philosophical level. The leadership of COSATU also
 engages with the Ministry of Trade and Industry, especially around what the broad orientation is. There‟s
 what we call a framework for trade negotiations that have been negotiated between government, business
    and labour, and essentially what it does is that it outlines what the key objective should be of trade
negotiations, so for example promoting jobs and development and sustainable industries, and all those sorts
               of things is contained in that framework, and that‟s as a result of discussions. 133

COSATU and government do consult and discuss with each other on a regular basis also
outside of NEDLAC, sometimes in less official forums or small meetings between the
General Secretary of COSATU and the Minister of Trade and Industry when
disagreements surface.134 At the last level, organised labour, COSATU as well as other
trade union federations, FEDUSA and NACTU, are also part of the government‟s official
WTO delegation.135

This participation, however, is not considered by all as very meaningful. “The WTO is
not just about trade, it is about power and control of resources. Developed countries
shape and control the trade regimes that affect developing countries and that lead to de-
industrialisation, job losses and worsening of poverty”, writes Jennifer Chiriga, a
respondent working for the AIDC.136 The WTO is, in other words, not simply a structure
geared towards facilitating objective technicalities surrounding the conclusion of trade
agreements, but a body controlled by the world‟s most powerful nations seeking to keep
their comparative advantage in the trading process. The WTO is considered inherently
undemocratic, and the negotiations taking place within its structures are undermined by
back-door trading, threats and bribery. Thus, one respondent says, it is almost pointless
for civil society to take part in WTO processes, as its voice is effectively silenced by
undemocratic practices.137 Furthermore, the trade unions that are a part of the
government‟s negotiating team are merely observers; they do not have an automatic right
to present views and demands alternative to those of the government‟s official line.138
Even if civil society participants in the trade negotiations differ markedly from
government representatives, their opinions are not valid in the negotiations.

COSATU has put some work into trying to build solidarity linkages with other civil
society organisations, mainly NGOs, from different countries at the WTO. At the Hong
Kong Ministerial, the whole South African delegation met with NGOs from all over the
world as a part of COSATUs initiative to build linkages, and the government was due to
this effort dubbed “fairly progressive”.139 It has been noted that the Hong Kong
Ministerial saw an opening up of the South African government towards civil society:
this was the first time South African and international civil society were invited to take
part in some of the government‟s delegation meetings.140 Government also points to the
“unique” interest it took in meeting with civil society from different parts of the world
during the Hong Kong Ministerial, where “extensive” discussions were held between the
South African delegation and official civil society delegations, and the delegation that
went to this Ministerial was well united.141

Still, on the question of whether the government‟s trade delegations and structures are
open to public scrutiny, an overwhelming majority of respondents for this study answered
negatively, with one view being that they “very consciously try and be as opaque as
possible”, and on occasion business and labour are united in their call for government to
put its position in writing and make it known.142

    That comes out [at] the discussions at NEDLAC. Some of the more heated ones have been around
     confidentiality, and they‟re very reluctant to a) put anything in writing and b) to make documents
available... Confidentiality is a very big issue…It‟s because some of the DTI officials just work on a need-
              to-know basis and transparency and accountability isn‟t part of their thinking.143

But perhaps the biggest stumbling bloc for cooperation between government and civil
society, and the main area of disagreement has more to do with differing ideological

Now, there‟s no illusion from my side, there‟s a very different philosophical approach to these negotiations
 between ourselves and government. Government…[is] committed to some free marketism and they just
                               want to liberalise trade as far as possible.144

I think in general, government takes a position of how can South Africa and the private sector benefit from
trade negotiations, and the argument would be that we need to have trade liberalisation because it will lead
 to more competition…I don‟t think there is a strong concern about job losses or the impact on labour, no,
                                      not from government‟s side.145

The agreements seem to be more about attracting either investment, which they say is going to create jobs,
or it‟s about South African gain...There seems to be more negotiations which favour business, rather than
                            either South African labour, or African labour. 146

COSATU has since the early years of democracy in South Africa been opposed to the
free market and liberalisation approach favoured by the government. Already before the
Seattle Round of negotiations, as South Africa entered the General Agreement on Trade
in Services (GATS), did the federation predict that job losses would follow the reduction
of tariffs.147 “We reject GEAR and free market purity as inappropriate to address the
socio-economic and political ills of South Africa. Market forces on their own will not
build efficient and dynamic industries nor maximise the national social and economic
interests”, a COSATU Inaugural Central Committee statement reads.148

Government itself remarked that while there are differences in approaches and ideas,
there was significant agreement between government and civil society at the Hong Kong
Ministerial. There, the government issued a…

     …very, for our government, surprisingly strongly worded statement, criticising the thrust of WTO
  initiatives…That critique provided space for COSATU for the first time, ever, and it certainly used that
                                        space very effectively.149

It has been remarked that the engagement with a government more critical to the WTO
in turn led to the radicalisation of COSATU, and that the federation has adopted a
position very different from its previous stance:

                   It is now radical, as opposed to being the worst form of reformism.150

Nevertheless, a major constraint put on unproblematic cooperation and agreement comes
from the fact that government is more sensitive to “diplomatic pressures” than civil
society is.151 The view that civil society has greater autonomy compared to government
and can thus take more principled positions is echoed by two respondents:

It has a flexibility that government doesn‟t have – you‟re seldom called to compromise, you‟re not making
    trade-offs. So civil society is able to stick to issues around principles and good intentions and what‟s
       actually working for people rather than what‟s in the interest of business or another country.152

[S]ometimes governments don‟t want to offend each other. South Africa don‟t want to say bad things about
  the US, and maybe US sometimes doesn‟t want to say bad things about South Africa, but civil society has
 that space to be critical and say things that they know are controversial…That‟s what civil society is for, is
                                 to keep governments and states accountable.153

Two respondents felt that the government‟s negotiating teams do try to take labour
standards and unemployment into account when designing trade policy and approaching
trade partners, though the role of ensuring that the issue of labour standards and job
losses was considered to lay mainly with the involved trade unions, which are concerned
with labour standards and job losses.154

The COSATU delegates would be, but…because they are part of the official delegation, they haven‟t been
able to disagree with government. So privately, they will be critical of it…The government itself is being
                      quite prepared to trade jobs for perceived trade advantages.155

The COSATU representative pointed out that following an initiative of COSATU, the
unions and the government do have an agreement on core labour standards that must be
taken into account during trade negotiations156:

                     Of course, it‟s rejected at the WTO, but we have an agreement. 157

It has been pointed out that the consideration for gender equality is missing at the WTO,
and the link between trade and the differential impact trade has on men‟s and women‟s
socio-economic status is not spelled out.158 “One of the major gaps is that while WTO
rules encompass all levels of economic development, there is no gender analysis that

assesses these rules in a structured way.” 159 It follows that to the question “Do existing
trade agreements take gender equality into account”, all of the respondents answered
“no”, some with the qualification “definitely not”.

 Most of the time, gender equality is not on the table, unless someone says it openly, but most of the time
 people don‟t think about it…Even within civil society itself, sometimes gender equality is forgotten. 160

    If you‟re looking at the South African-EU agreement, gender doesn‟t seem to feature as an issue.161

The government‟s trade delegations and structures fared little better in the evaluation and
overall impression of how gender sensitive they were: 6 respondents answered “no” to
the question of whether the government‟s structures and delegations are concerned with
the impact trade agreements have on gender equality, while two respondents said

                   I think the NGOs raise it. But I don‟t think that‟s an overt ambition. 162

                                               No, no ways.163

                                     In practice, almost certainly not.164

Some respondents highlighted the contradiction between the government‟s theoretical
positions and official concerns, and the actual practices and approaches they employ in
trade negotiations. Often, the government expresses concern over and an interest in
development and strengthening labour standards and reducing unemployment, but in the
negotiations themselves, they tend to ignore social issues and be indifferent to pressing
issues facing workers, women and other vulnerable groups.

There is a sense coming out of these interviews that most civil society organisations
working on trade do not consider themselves as working with government in an engaging
and dynamic partnership, but as outsiders having to fight for space and for their voices to
be heard (though COSATU is an important exception to this view). They are not
automatically granted serious consideration for their views and ideas. Still, many feel that
civil society has made an impact on trade negotiations in some areas.
    I think there has been some, in terms of sensitising the negotiators to the various dynamics of global
  trade…The analysis that is available, particularly from AIDC, I think it has found its way into relevant
 government structures that deal with trade and so on. So, I think, while there is a long road ahead, there is
                                        some level of engagement.165

In other cases, respondents thought that almost no impact had been made in South Africa,
while the governments of the rest of sub-Saharan Africa have been more impressionable.

 On the World Trade Organisation scale, if one looks in general…then I‟d argue that it is because of civil
   society‟s involvement and concern with trade that we have been able to influence the positions of the
governments of the South. So I would argue that the governments of the South are taking stronger positions
   because…civil society has pushed the agenda on this…I wouldn‟t say that‟s the case in South Africa,
because South Africa, unfortunately, has taken positions that were previously much more in line with more
                         influential counties, the kind of developed countries. 166

 I think in South Africa it has had a little impact, very little. But I think in other countries, I think there‟s
 been a bigger impact…South Africa is not one of the leading counties that are challenging the EU or the
                      US – South Africa has been dubbed as the puppet of the US.167

One major reason for this lack of impact, according to one respondent, is that South
Africa‟s civil society has not prioritised trade issues, but has concentrated on more direct
and visible social issues:

         There hasn‟t been inside the country organisation against government policy on trade. 168

In other words, civil society itself also needs to put in more effort and show a stronger
interest in trade issues, and it needs to coordinate its efforts better in order to be more
effective in making its views heard.

There is cooperation between numerous civil society organisations on trade, both
nationally and internationally. The Trade Strategy Group (TSG) is one network that seeks
to coordinate and strengthen the input of civil society, including NGOs, community
organisations and trade unions. The TSG is a forum where information is exchanged,
updates on trade issues are given, key issues discussed and activities proposed.169 While
the size of TSG meetings vary, as some issues draw more interest than others and it is
difficult to find a date that suits all involved,170 there is a large number of organisations
that have signed up as participants in the network, indicating that a large section of civil
society has recognised the need for more cooperation and better coordination around
trade issues. A lot of the cooperation that takes place between different organisations has
to do with the sharing of experiences and learning from one another, alternatively to
educate the constituencies of the organisations. Relatively little direct campaigning
around trade is taking place, though COSATU and its affiliates tend to initiate campaigns
especially when their respective sectors are threatened or undermined by trade
agreements. There is, nevertheless, an expressed wish by several of the respondents that
there is a need for serious coordination of campaigns, as this is considered an important
means to pressure government to take the voices of civil society into account.

Not surprisingly, all respondents, including the government representative, did see a vital
need for civil society to be involved in shaping public opinion and putting pressure on
government to take a more gender-conscious, labour-friendly and developmental position
when entering trade negotiations. Civil society can often take more uncompromising and
radical positions than government, and can pursue the interests of the people „on the
ground‟ without worrying about pressures from other powerful interests, like business.
The organisation of the popular section of society is necessary to pursue a more
developmental position on the part of government, and civil society is also part of
deepening democratic accountability.

 They play an important monitoring and “watchdog” role and raise the alarm bells of the consequences of
 these negotiations, through lobbying, advocacy, protest action, etc. Another important reason is holding
                         government accountable for the negotiating decisions. 171

 [It is important] at many levels. One is [that civil society] are part of the democratic process… it‟s a large
  constituent…. They ought to have a say, just by virtue of the democratic process. Then, of course, trade

  does impact on all citizens. Not just in their capacity as workers, but just as citizens, and for that reason
                alone, it‟s important that civil society – whatever it means – has a say.172

Civil society often has a much greater understanding of how things play out on the ground…Civil society is
  inevitably diverse, and often has issue-specific agendas, and so it‟s able to focus on things that will be a
   concern to some members of the population but which can get lost in the generalness of a government

   Well, I think civil society would be in many ways the conscience of government, because I think the
approach of government in these negotiations tends to be very geared towards economic development. But
  civil society, on the other hand, is geared towards social development, looking more to the interests of
                             people rather than the economy in general terms. 174

  Civil society presents government with the voice of the ordinary people who would not have otherwise
                                 have had an opportunity to be heard.175

The social justice civil society organisations that are involved in trade on some levels in
South Africa do think that their influence should be strengthened. While there is much
criticism of the government‟s approach to trade and civil society‟s role in negotiations
and calls to government to be more inclusive and receptive of civil society‟s views, there
is also a recognition that civil society itself needs to be better coordinated and organised
for its views to get more weight, and stronger campaigns are necessary to pressurise
government and make the voice and views of civil society heard.

 A crucial thing is for the different civil society organisations to work together, because they are not at the
moment. Particularly community organisations and trade unions, they are not coming together. And I think
they should, particularly around provision of services and the privatisation of services in the Agreement on
 Trade in Services…It is crucial – I don‟t think we‟re gonna go anywhere if we are fighting each other as
                                          civil society organisations.176

   [R]ather than just generating hundreds and hundreds of declarations, there should be a way to make the
  declarations find their way to relevant people who are within government, so that they are aware of what
civil society‟s position is…Because it is of no use if we just speak to ourselves as civil society and we don‟t
        make the link with government, so I think we need to strengthen that process of linkages with

   More spaces need to [be] created for continuous and frank engagement and less window-dressing.178

[W]e need some feedback on some of the problematic areas, so that we can also advocate and lobby around
                                           those issues.179

I think that civil society is very useful in calling government to account, so asking more strategic questions
 in parliament, perhaps through the media, around what and why South Africa [is] negotiating a particular

 I just think that there needs to be a stronger realisation by organisations that may not necessarily work on
 trade specifically to realise how trade issues affect organisations…And a realisation that [trade and trade
negotiations] actually…influence different sectors of society…and how do we then work together on these

There is also a “huge gap” in the analysis of how trade agreements and negotiations
impact on development:

                   Civil society can do some of that research and that…will be useful.182

One “huge challenge” to civil society is to mobilise popular interest around trade issues,
as trade is seen as a complicated issue and something not relating to their everyday lives.
Trade is most of the time not considered as pressing or relevant until trade agreements
directly impacts on people‟s lives, like in the clothing and textile industry, where trade
liberalisation directly led to massive job losses.183 Thus, the very nature of trade
negotiations as processes that are far removed from people‟s lived realities, and the
difficulty to make the connection between different agreements and their effects, makes it
hard to organise strong, popularly based campaigns to increase the influence of civil
society regarding trade.

Finally, international experiences are important to draw from, when civil society is
looking to build alternatives.

  There are some exciting developments in…the Americas below the US-Mexico border. I think there are
 exciting developments in terms of trade, and think these are challenges to the mainstream trade agenda. I
think it‟s important that we begin to look at those and begin to raise awareness in South Africa about those
     alternatives and how can we also begin to develop alternatives…The mainstream agenda is being

According to the government representative interviewed in this study, South Africa‟s
civil society groups should link up with their counterparts around the world to try to shift
the prevailing political climate which sets the parameters for trade negotiations through
international lobbying and more engagement with the South African government:

                  Sometimes the views of our civil society are not prominent enough. 185

9. Summary

The civil society organisations sampled for this study certainly think there is a need for
their involvement in trade negotiations, and they felt they were entitled to more weight
and influence than they have at present. Still, the approach to government is in most cases
nuanced and based on wishes of a closer and more engaging relationship rather than on
increased antagonism and a more powerful outsider position.

While there was no consensus among the respondents on how labour friendly the
government‟s trade delegation is, there was a unanimous agreement that the trade
agreements negotiated by the South African government did not reflect any concern for
gender issues. One respondent furthermore highlighted the fact that gender issues were
also not always highlighted by civil society itself. Out of eight respondents, six answered
“no” to the question of whether the government‟s trade delegations and structures took
gender equality into account, and two answered “sometimes”, one with the qualification
that when gender issues are taken up, it most probably originates from the NGOs.

There seems to be a rather healthy awareness among civil society representatives that
while there are structural constraints on the ability of civil society to influence trade
negotiations – for example, community organisations and NGOs are not represented in

the NEDLAC Trade and Industry Chamber – it also needs to be critical of its own
organisational abilities. Several respondents felt that civil society as a whole needs to
coordinate its efforts better, build its internal capacities and organise stronger campaigns

Several respondents commented that government‟s trade policy is based on neo-liberal
principles that are not fully compatible with socio-economic development. Though the
government emphasises the significance of civil society‟s input, this difference in
ideological approach to trade policy seems to inhibit a more reciprocal and equal
interaction between the two sides. While civil society perceives its role to be
safeguarding the interests of the „grassroots‟ in a broad meaning, government feels the
constraints of an international trade regime and diplomatic expectations, and is therefore
often resistant to the more radical and far-going demands articulated from civil society. It
has been noted that the government is not static in its approach and attitude towards civil
society: the Hong Kong Ministerial saw a more open, inclusive and even radical
government delegation that actively sought the input from civil society from all over the
world. This was welcomed by trade activists – who still do not see any reason for
complacency in continuing to build campaigns, spread information and try to influence
the government in a more people-friendly direction; the general view is that there is a
long way to go before the South African trade structures and processes – not to mention
the WTO – are genuinely democratic, inclusive and more directed to promote
development than profit-making.

10. Recommendations

Campaigns, many representatives in this study have pointed out, is a very important tool
to make government listen more carefully to the voices of civil society, and there is a
need to start broad, popular campaigns in order to make government more receptive to
civil society.
It seems that one of the major challenges for building strong campaigns is the question of
how to draw in and mobilise a large number of people around trade issues. The NGOs
that work directly with communities around issues such as unemployment, globalisation
and privatisation, gender and youth – as well as the trade unions which rest solidly on a
working class base – are strategically placed to integrate trade patterns and the impact of
trade in their everyday campaigns and educational activities.
To treat the national and international trade regime as an integral part of core campaigns
and activities, rather than as an “add-on”,186 and to clearly demonstrate the link between
daily reproductive struggles and trade effects to their constituencies, is one way for civil
society to spread a deeper understanding more wider, and to build an awareness that can
serve as a catalyst for demands and campaigns specifically directed to the government‟s
trade approach.

Another route that should be simultaneously pursued, and which is being discussed in the
Trade Strategy Group, is to apply for representation in TESELICO. Even an observer
status would provide up-to-date information to civil society and support them in their

campaigns and educational activities, and would simultaneously increase the visibility
and authority of community organisations and NGOs. A full membership would
obviously be even better, as communities and NGOs would have a direct, official channel
through which to put forth their views, and they would thus be considered more of an
equal partner and be given more influence.

Lastly, there seems to be a difference in influence between organised labour on the one
hand, and community organisations and NGOs on the other, where the former has more
chances to influence government‟s position. As one respondent has pointed out, there
needs to be a stronger bond forged between the different sectors of civil society. The
formation of the TSG is one attempt to do so. COSATU and its affiliates on occasion
coordinate campaigns and mass action around certain trade issues. This has been the case
of the National Union of Metalworkers of South Africa (NUMSA), which recently had a
campaign against NAMA, and COSATU as a federation has also initiated some trade
campaigns. If community organisations and NGOs to supported every COSATU
campaign, with human resources, education, dissemination of material and research, this
could lead to stronger campaigns and closer working relationship within civil society

11. Endnotes

  Growth, Employment and Redistribution – A Macroeconomic Strategy, 14 June, 1996
(http://www.polity.org.za/html/govdocs/policy/growth.html); Hjort, L. & Ramadiro, B. “A Long Walk to
Nowhere – Ten Years of Democracy in South Africa”, Röda Rummet, no 1, 2004 (or: www.aidc.org.za)
  Keet, D. “Towards and Beyond the WTO. Challenges Facing the South African Government”, AIDC,
November, 2005
  Accelerated and Shared Growth Initiative – South Africa (ASGISA). A Summary, the Presidency,
Republic of South Africa, http://www.info.gov.za/asgisa accessed on 7 August, 2006, p. 2
  Ibid, pp. 2, 4
  Ibid, p. 4
  “Acquisition of a Majority Shareholding in ABSA Group Limited (“ABSA”) By Barclays Bank PLC
(“Barclays”)”, Media Statement, National Treasury of the Republic of South Africa, 8 May, 2005
   Accelerated and Shared Growth Initiative – South Africa (ASGISA). A Summary, op cit, pp. 4-14
  “A Guide to the Right To Work (R2W) Campaign”, Fact Sheet #1, AIDC, 2006; “Scale of the
Unemployment Crisis in South Africa”, Fact Sheet #2, AIDC, 2006
  “A Guide to the Right To Work (R2W) Campaign”, op cit.
   Keynote Speech by Minister of Trade and Industry, Mandisi Mpahlwa, South Africa‟s National
Consultative Conference for the 6th WTO Ministerial, Gallagher Estate, 27 October, 2005
   Keet, D. 2005, p. 8
   Ibid, p. 8
   Keynote Speech by Minister of Trade and Industry, Mandisi Mpahlwa op cit.
   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade accessed on 24 July 2006
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   Erero, J. “The Textile Sector of the South Africa as Evaluated Through the dti Gravity Model”, the dti
Statistics Newsletter, June, 2005

   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit
   Ibid; “WTO Talks to Finalise Modalities”, DTI Press Statement, 27 June, 2006 (www.thedti.gov.za)
   “WTO Talks to Finalise Modalities”, op cit.
   Keynote Speech by Minister of Trade and Industry, Mandisi Mpahlwa op cit.
   http://www.g-20.mre.gov.br/history.asp accessed on 14 August, 2006; Osava, M. “G20+ Might Just Add
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Aims of Regional Cooperation and Integration in Africa”, AIDC Regional Briefings Series #1, Cape Town,
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August, 2006
   “South African Trade with Africa”, SouthAfrica.info – The Official Gateway, op cit.;
http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.
   http://www.sadcreview.com/country_profiles/southafrica/southafrica.htm accessed on 26 June, 2006
   Erero, J. 2005, op cit, p. 16
   http://ww.thedti.gov.za/publications/statQ3_2005.pdf accessed on 26 June 2006
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   The Shopsteward, 2005, op cit.
   Erero, J. 2005, op cit. p. 16
   The Shopsteward, 2005, op cit.
   Davies, M. J. Business Day, 6 February 2006 Article ID: 1883464 (www.businessday.co.za)
   Dawes, N. “Learning to Ride the Tiger”, Mail and Guardian Online, 26 June, 2006 (www.mg.co.za)
   Kumar Chanda, A. 2006, op cit; “South Africa is Perfectly Positioned to Assist China as it Woos Africa”,
Business Day, 29 June, 2006 (www.businessday.co.za); “The Program of Cooperation of Deepening the
Strategic Partnership between the People‟s Republic of China and the Republic of South Africa (Abstract)”,
issued by the Ministry of Foreign Affairs of the People‟s Republic of China,
http://www.fmprc.gov.cn/eng/zxxx/t259894.htm accessed on 4 September, 2006
   “The Program of Cooperation of Deepening the Strategic Partnership between the People‟s Republic of
China and the Republic of South Africa (Abstract)”, op cit.
   http://www.thedti.gov.za/econdb/raportt/rapottr.html accessed on 26 June, 2006
   BUYUSA.GOV – US Commercial Service, http://www.buyusa.gov/southafrica/en/353.html?print=1
accessed on 17 July 2006
   http://www.thedti.gov.za/econdb/raportt/SATradeinWorld.html accessed on 29 June 2006
   http://www.trademap.net/sacu/country_glo_2di.htm accessed on 3 September, 2006
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on 3 September, 2006
   “Opening the Doors on SA-EU Trade”, DTI press release, 7 February, 2006 (www.thedti.gov.za); “South
African Trade with Europe”, SouthAfrica.info – The Official Gateway, http://www.southafrica.info
accessed on 17 July 2006
   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.

     “South African Trade with Europe”, SouthAfrica.info – The Official Gateway, op cit.
     Ibid; http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.

accessed on 3 September, 2006

accessed on 3 September, 2006
   “SA Trade with North America”, SouthAfrica.info – The Official Gateway, op cit.; Draper, P. “Business
Must not Miss this Boat”, Business Day, 29 June 2006 (www.businessday.co.za)
   Quoted in Lourens, C. “New World Beckons for SA Exporters as Deals Extend Boundaries of Free
Trade”, Business Day, 10 June 2005 (www.businessday.co.za)
   Lourens, C. “The „One Size‟ Trade Pact that Doesn‟t Fit at All”, Business Day, 25 April, 2006
   Lourens, C. “Sacu, US Agree on Trade Talks Framework”, Business Day, 19 April, 2006
   Lourens, C. “Trade Beat”, Business Day, 5 September, 2006
   Trade Strategy Group meeting, Johannesburg, 22 August, 2006
   “SA Trade with the Middle East”, SouthAfrica.info – The Official Gateway, op cit.

accessed on 3 September, 2006
   “SA Trade with the Middle East”, SouthAfrica.info – The Official Gateway, op cit.
   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit; Seligman, F. “Brazil, India and South
Africa Optimistic about Future Ties”, IPS, 13 September, 2006
   “South African Trade with Asia”, SouthAfrica.info – The Official Gateway, op cit.;
http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.
   Dawes, N. 2006, op cit; J. 2006, op cit.
   Kumar Chanda, A. “China to Cement Ties with South Africa”, Mail and Guardian Online, 19 June, 2006
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   Dawes, N. 2006 op cit.; Davies, M. J. 2006, op cit.
   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.;
http://www.mbendi.co.za/import/sa/agree_int.htm#MERCOSUR accessed on 14 August, 2006;
http://en.wikipedia.org/wiki/Mercosur#FTA_with_third_parties accessed on27 September, 2006
   Lourens, C. “Trade Beat”, op cit.
   “South African Trade with Africa”, SouthAfrica.info – The Official Gateway, op cit.
   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.
   http://www.thedti.gov.za/publications/statsQ3_2005.pdf accessed on 14 August, 2006
   “First EFTA Free Trade Agreement in Sub-Saharan Africa”, 1 July, 2006,
http://www.bilaterals.org/article.php3?id_aricle=5218 posted on 11 July, 2006
   “South African Trade with Africa”, SouthAfrica.info – The Official Gateway, op cit.
   http://www.info.gov.za/aboutsa/economy.htm#foreigntrade op cit.
   “South African Trade with Africa”, SouthAfrica.info – The Official Gateway, op cit.
   http://www.southafrica.info/doing_business/sa_trade/agreements/traderelations.htm accessed on 26 June
   “Civil Society in the New Millenium: The Case of South Africa”, prepared for SANGOCO,
Johannesburg, 1999, p. 28

   Swilling, M. & Russell, B. “The Size and Scope of the Non-Profit Sector in South Africa”, Graduate
School of Public and Development Management, Centre for Civil Society, South Africa, 2002 (?), p. 4
   Ibid, p. 4
   Ibid, p. 69
   The Non-Profit Organisations Act of 1997, quoted in ibid, p. 76
   The Non-Profit Organisations Act of 1997, quoted in “Civil Society in the New Millenium: The Case of
South Africa”, op cit, p. 20
   “Civil Society in the New Millenium: The Case of South Africa”, op cit, p. 20
   Swilling, M. & Russell, B. 2002 (?), op cit, p. 5
   Ibid, p. 77; “Civil Society in the New Millenium: The Case of South Africa”, op cit.
   “Civil Society in the New Millenium: The Case of South Africa”, op cit, pp. 36, 38
   Swilling, M. & Russell, B. 2002 (?), op cit, p. 4
    Civil Society in the New Millenium: The Case of South Africa”, op cit, p. 36
    Ndlovu, N. “The Cinderellas of Development? Funding CBOs in South Africa”, INTERFUND, South
Africa, 2004, p. 10
    Le Pere, G. “Government and Civil Society Can Engage Again”, Business Day, 3 June 2006
    Keet, D. “South Africa‟s Official Position and Role in Promoting the World Trade Organisation”,
AIDC, reprint, 2004, pp. 8-9
    Ibid, p. 9
    Ibid, p. 9
    Le Pere, G. 2006, op cit.
    Interview with Freddy Mnyongani, Project Officer, Justice and Peace Department, SACBC, via e-mail,
August, 2006
    http://www.nedlac.org.za/top.asp?inc=about/overview.html accessed on 1 August, 2006
    http://www.nedlac.org.za/top.asp?inc=about/tic.html accessed on 1 August, 2006
    Interview with Jeff Rudin, Research Officer, SAMWU, Cape Town, 25 July, 2006; Interview with Tony
Ehrenreich, Western Cape Provincial Secretary, COSATU, Cape Town, 2 August, 2006
    Interview with Priscilla Vumathi, Administrator, Trade & Industry Chamber, NEDLAC, via telephone,
24 August, 2006; Interview with Ntibi Maepa, Coordinator, Trade & Industry Chamber, NEDLAC, via
telephone, 29 August, 2006
    Trade Strategy Group meeting, Johannesburg, 22 August, 2006
    http://www.nedlac.org.za/top.asp?inc=about/tic.html op cit.
    Interview with Priscilla Vumathi, op cit
    Ibid; Interview with Ntibi Maepa, op cit.
    Interview with Ntibi Maepa, op cit.
    Keynote Speech by Minister of Trade and Industry, Mandisi Mpahlwa, 2005, op cit.
    Interview with Tony Ehrenreich, 2 August, 2006, op cit.
    Interview with Rob Davies, Deputy Minister of Trade and Industry, via telephone, 1 August, 2006
    Interview with Malcolm Damon, Director, EJN, Cape Town, 7 July, 2006
    Swilling, M. & Russell, B. 2002 (?), op cit, p. 79
    Interview with Jeff Rudin, op cit.
    Interview with Malcolm Damon, op cit.
    Interview with Neil Newman, Research and Education Officer, ILRIG, Cape Town, 27 July, 2006
    Interview with Jennifer Chiriga, Globalisation and Alternatives Unit Coordinator, AIDC, Cape Town,
14 July, 2006
    Interview with Malcolm Damon, op cit.
    Interview with Vuyiseka Dubula, Treatment Literacy Coordinator, TAC, Cape Town, 17 July, 2006
    Interview with Jeff Rudin, Research Officer, op cit.
    Interview with Rob Davies, op cit.
    Interview with Tony Ehrenreich, Western Cape Provincial Secretary, COSATU, Cape Town, 18 July,

    Ibid. (2 August, 2006)
    Chiriga, J. “Trade, Gender and the Search for Alternatives”, Pambazuka News, 2 February, 2006
    Interview with Neil Newman, op cit.
    Interview with Tony Ehrenreich, op cit.
    Interview with Michelle Pressend, Senior Researcher: Multilateral Programme, IGD, via e-mail, July
    Interview with Rob Davies, op cit.
    Interview with Jeff Rudin, op cit.
    Interview with Tony Ehrenreich, op cit.
    Interview with Malcolm Damon, op cit.
    Interview with Neil Newman, op cit.
    Interview with Tony Ehrenreich, 4 August, 2006, op cit.
    The Shopsteward, 1998, op cit.
    Interview with Jeff Rudin, op cit.
    Interview with Rob Davies, op cit.
    Interview with Jessica Wilson, Programme Manager, EMG, Cape Town, 25 July, 2006
    Interview with Vuyiseka Dubula, op cit
    Interview with Michelle Pressend, op cit.
    Interview with Jeff Rudin, op cit
    Interview with Tony Ehrenreich, 18 July, 2006 and 2 August, 2006, op cit.
    Chiriga, J, 2006, op cit.
    Interview with Vuyiseka Dubula, op cit.
    Interview with Neil Newman, op cit.
    Interview with Tony Ehrenreich, op cit.
    Interview with Vuyiseka Dubula, op cit
    Interview with Jeff Rudin, op cit.
    Interview with Jennifer Chiriga, op cit.
    Interview with Malcolm Damon, op cit.
    Interview with Neil Newman, op cit.
    Trade Strategy Group meeting, Johannesburg, 22 August, 2006
    Personal communication with Freddy Mnyongani, Johannesburg, 22 August, 2006
    Interview with Michelle Pressend, op cit.
    Interview with Jeff Rudin, op cit.
    Interview with Jessica Wilson, op cit.
    Interview with Jennifer Chiriga, op cit.
    Interview with Freddy Mnyongani, op cit.
    Interview with Neil Newman, op cit.
    Interview with Jennifer Chiriga, op cit.
    Interview with Michelle Pressend, op cit.
    Interview with Vuyiseka Dubula, op cit
    Interview with Jessica Wilson, op cit.
    Interview with Malcolm Damon, op cit.
    Interview with Jessica Wilson, op cit.
    Interview with Jeff Rudin, op cit; Interview with Neil Newman, op cit.
    Interview with Neil Newman, op cit.
    Interview with Rob Davies, op cit.
    Interview with Jeff Rudin, op cit


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