Towards the Continental Free Trade Area – opportunities for South Africa’s Industrial Policy Action Plan priority sectors in the Kenyan market
Since the launch of the tripartite free trade area (TFTA) negotiations between the member states of the Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC), and the Southern Africa Development Community (SADC), there has been growing interest from South Africa to further expand its market into the African continent. This, coupled with prospects of a continental free trade area (CFTA), has made focus on Africa a priority for South Africa.
The focus on Africa is no surprise given South Africa’s economic dominance and the prospects of gaining duty-free market access beyond SADC make Africa a lucrative market if South Africa is to accelerate growth along a path that generates sustainable, decent jobs to address apartheid legacies in line with its national development strategy. To achieve this, South Africa’s National Industrial Policy Framework (NIPF) and the Industrial Policy Action Plan (IPAP) are central components of this strategy and seek to encourage and upgrade value-added, labour-absorbing industrial production.
This paper provides an analysis of opportunities for South Africa in the Kenyan market in the following sectors: agro-processing; automotives; pharmaceuticals; and metal fabrication, capital and rail transport equipment (MCR). Clothing, textiles, leather and footwear have been deliberately omitted from this analysis, as previous in-depth analyses on this sector have already been undertaken. Furthermore, forestry, wood and paper products have been included under agro-processing (which is a separate sector under IPAP); and we also focus on pharmaceuticals, given South Africa’s advanced infrastructure and technology that are required for this specific subsector.
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