South Africa’s trade in cultural goods and services with a focus on cultural trade with BRICS partners

ABSTRACT

As the potential for cultural and creative industries to drive growth and job creation is increasingly recognised, developing countries like South Africa are examining their cultural goods and services trade in a new light. This article investigates the pattern of South Africa’s cultural trade, with a focus on the strategically important BRICS trading bloc. Results show that, like many small, open developing countries, South Africa has a significant cultural goods trade imbalance, especially with China and India. While cultural trade policy is still somewhat fragmented, there are indications that where policies have been put in place, such as in the crafts and audio-visual sectors, progress in reducing significant deficits has been made. At the same time, the pattern of CCI trade preferences currently favours SADC, the EU and EFTA over BRICS partners. Finally, South Africa performs well in a number of services sectors for which cultural trade is important.

KEYWORDS:

• Cultural and creative industries
• trade
• South Africa

Acknowledgments

Part of the research in this article was produced for the South African Cultural Observatory (SACO) Mapping Study of the Cultural and Creative Industries in South Africa. The financial assistance of SACO is gratefully acknowledged.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. Other SACU members are the neighbouring states of Botswana, Lesotho, Namibia and Swaziland.

2. SADC is a southern African regional organisation with 15 member states (Angola, Botswana, DRC, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe). A free trade area is in place among a subset of member states, including South Africa.

3. South Africa is engaged in ongoing limited PTA negotiations with India and signed a Comprehensive Strategic Partnership Agreement with China in 2010. A BRICS trade and investment cooperation framework also exists.

4. This system is based on the sixth edition of the Balance of Payments and International Investment Position Manual (BPM).

5. Indeed, there have already been significant budget shifts: in 2017, nearly 23% of the budget for funding cultural festivals and events (essentially performing arts) was ‘reprioritized’ to a venture capital fund for support of small, medium and micro cultural enterprises (National Treasury 2017).

6. The Grubel-Lloyd index is given by Bi = (1 – (│Xi – Mi│)/(Xi + Mi))) x 100.

7. The intra-industry trade index ranges from 0 to 100%, with higher percentages reflecting greater two-way trade within a sector. An index of 0 indicates no overlapping trade within that sector, while an index of 100% reflects exports and imports of the same value within that sector.

8. The limited PTA between SACU and MERCOSUR, signed in 2009, provides for preferences on approximately 1000 product lines in each direction.

9. Authors’ calculations based on SARS (South African Revenue Service) (2018) and UNESCO (2009).

10. See https://www.wto.org/english/tratop_e/serv_e/serv_commitments_e.htm. It should be noted, however, that these GATS obligations came into effect at the beginning of 1995. The current domestic reality in most countries is significantly different, with a greater degree of openness in many cases.

Additional information

Funding

This work was supported by the South African Cultural Observatory.