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Trade Liberalisation, Efficiency and South Africa's Sugar Industry

  • McDonald, Scott
  • Punt, Cecilia
  • Leaver, Rosemary

This paper reports the results of a computable general equilibrium (CGE) analysis of the South African sugar industry. The study was inspired by analyses of the EU South Africa Free Trade Agreement that indicated the importance of sugar exports to the welfare gains from agricultural trade liberalisation and by the increasing pressure upon OECD countries to reform their sugar (trade) policies. In addition to the effects of trade liberalisation this study also considers the implications of increases in the efficiency with which sugarcane is converted to raw sugar, which is an important determinant of the competitiveness of sugar production and exports. The results indicate that there would be substantial welfare gains across all household groups and that overall agricultural producers in South Africa should benefit; however there are substantial variations in the impact upon agricultural producers in different provinces, with farmers in some provinces facing reductions in the profitability of farming.

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File URL: http://purl.umn.edu/15634
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Paper provided by PROVIDE Project in its series Working Paper Series with number 15634.

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Date of creation: 2004
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Handle: RePEc:ags:provwp:15634
Contact details of provider: Web page: http://www.elsenburg.com/provide

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  1. John C. Beghin & Ataman Aksoy, 2003. "Agricultural Trade and the Doha Round: Lessons from Commodity Studies," Center for Agricultural and Rural Development (CARD) Publications 03-bp42, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  2. Pyatt, Graham, 1988. "A SAM approach to modeling," Journal of Policy Modeling, Elsevier, vol. 10(3), pages 327-352.
  3. Mitchell, Donald, 2004. "Sugar policies opportunity for change," Policy Research Working Paper Series 3222, The World Bank.
  4. Michael Matsebula, 2001. "Key Issues facing Sugar Industries in the Southern African Development Community," Working Papers 01050, University of Cape Town, Development Policy Research Unit.
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