South Africa’s Maritime Policy and Transformation of the Shipping Industry

More than 95 per cent of South Africa’s trade volume is seaborne. Although South Africa is clearly an important sea-trading nation, it is not a significant shipowning or ship operating nation. Despite a decade of democracy, and the improved Ship Registration Act of 1998, the South African merchant marine has continued to decline. South Africa’s new Maritime Charter of December 2003 has the long-term vision “to develop South Africa to become one of the world’s top 35 maritime nations by the year 2014†. Currently, South Africa adopts a strongly market-driven shipping policy. In stark contrast the Charter calls for “a clear strategy/plan for the majority of South African cargo, going through South African ports to be carried on South African ships†. This article argues that although South Africa has a large volume of trade, it does not necessarily have a competitive advantage in the shipment of these goods. Thus policies to promote or protect the national shipping industry might not be in the broader economic interests of South Africa. JEL : R40