The Influence of International Trade Policies on the Economic Growth and Development of South Africa: Free Trade or Protectionism?
DOI:
https://doi.org/10.12724/ajss.71.2Keywords:
International trade, Free trade, Protectionism, Economic growth, Economic development, GlobalisationAbstract
This paper questioned the influence of International Trade Policies on the economic growth and development of South Africa by examining the effect of free trade and protectionism on economic growth and development. A literature search showed that South Africa follows a policy that seeks a balance between free trade and protectionism in South Africa. The paper applied the Mercantilism theory. Mercantilism is an economic development theory that advocates for home governments to regulate the economy and facilitate international trade so that domestic industries are promoted and protected. To gather relevant information, the paper followed a semi-systematic literature review as a methodology. The paper discovered that amid the current policy stance, which seeks to balance free trade and protectionism in South Africa, communities predominantly suffer from poverty, unemployment, and income inequality. The paper concluded that trade agreements and policies must be reevaluated if governments want to combat poverty, unemployment, and income inequality. Considering the above, the paper recommends that, owing to the power and role of government institutions in South Africa, selected areas of the economy must be reserved for local industries and producers, and MNCs must be brought in where local industries cannot supply.
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