Liquidity shocks and capital market efficiency in South Africa
- Authors: Matapuri, Dexter Tinotenda Kushinga
- Date: 2023-10-13
- Subjects: Liquidity (Economics) , Stock exchanges South Africa , Insolvency , Securities South Africa , Capital market South Africa , Investments, Foreign
- Language: English
- Type: Academic theses , Master's theses , text
- Identifier: http://hdl.handle.net/10962/419610 , vital:71659
- Description: Financial markets are dynamic in nature. As such, one way to keep up with their plethora of variables is to conduct research and seek understanding on how they all work together. Understanding financial market mechanics is the key to achieving and maintaining efficient capital markets. The goal of many economies is to have efficient capital markets mainly because they entail economic growth. One of the common avenues here being foreign direct investments. Therefore, over the years, a lot of financial economics research has been conducted on how best to attain financial market development which ultimately yields capital market efficiency. The opposite is also true. This research therefore set out to study the impact of liquidity shocks on capital market efficiency, more specifically stock market efficiency. As such, the overarching research goal was to determine the link between liquidity shocks and stock market efficiency in South Africa. Furthermore, the research also tested whether there is a homogenous impact exerted by liquidity shocks on the JSE Financial 15, JSE Industrial 25 and JSE Resource 20 indices. The arguments and thus conclusions of the research were constructed based on existing theories such as the Efficient Market hypothesis, Behavioural Finance and the Adaptive Market Hypothesis. Literature and existing empirical evidence related to the topic were also analysed and used for the same purpose. Econometric methods used to achieve these research goals include the time series and panel ARDL, impulse response and variance decomposition tests and the Granger Causality tests. The research found that liquidity shocks do impact stock market efficiency in South Africa in both the short run and long run. The direction of the impact was noted to vary with time and dependent on the liquidity shock proxy. Key findings here were that liquidity shocks lower JSE All-Share index efficiency in the short run thus allowing market participants to beat the market in the initial phases of a liquidity shock. Adding on, it was also found that illiquidity shocks lower efficiency for the JSE Financial 15 and Industrial 25 indices in the short run. In the long run, stock market efficiency is enhanced no matter the source of the shock. As such, the research recommended that regulatory policies should focus on liquidity shocks in the short run for the JSE All-Share index and on illiquidity shocks in the short run for the Financial 15 and Industrial 25 indices. , Thesis (MCom) -- Faculty of Commerce, Economics and Economic History, 2023
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- Date Issued: 2023-10-13
Exchange rate volatility and the returns on diversified South African investment portfolios
- Authors: Mulamu, Murendeni
- Date: 2022-04-06
- Subjects: Foreign exchange rates South Africa , Rate of return , Investments , GARCH model , Regression analysis , Autoregressive distributed lag (ARDL) model
- Language: English
- Type: Academic theses , Master's theses , text
- Identifier: http://hdl.handle.net/10962/284581 , vital:56076
- Description: Globalisation has made it much easier to invest in foreign countries. This creates endless options accessible to investors, including exploiting opportunities for investment in international economies. Although foreign investment portfolio diversification provides significant opportunities for financial returns, exchange rate volatility may play a prominent role when investing in foreign markets. Since the introduction of a floating exchange rate system, together with the inflation-targeting monetary policy framework in South Africa, there has been significant volatility in the exchange rate, far more than during the previous dispensations. This, however, creates a strong need to consider how the unpredictable nature of the exchange rate affects these investments. The purpose of this study is to analyse the effect of exchange rate volatility on the returns on diversified South African investment portfolios. This research examined whether there is a homogenous relationship between South African (domestic) portfolios and the internationally diversified portfolios. In addition, the study investigated the long-run relationship between the exchange rate volatility and both domestic portfolios and the internationally diversified portfolios for the period 2007-2019. To achieve these goals, a panel ARDL model was employed. This study found that exchange rate volatility does not account for a significant portion of returns on investment portfolios fluctuations. Moreover, the relationship is not homogenous because returns on domestic investment portfolios react positively to the exchange rate volatility, whereas returns international investment portfolios respond negatively/positively to the exchange rate volatility depending on whether the relationship is short or long run. This study will contribute to the existing literature, and it is important for investors intending to diversify their investment portfolios both domestically and internationally using different mutual funds in South Africa. , Thesis (MCom) -- Faculty of Commerce, Economics and Economic History, 2022
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- Date Issued: 2022-04-06
An empirical analysis of the asset price monetary policy transmission channel in South Africa
- Authors: Du Preez, Wilhelmus Petrus
- Date: 2021-10
- Subjects: Monetary policy South Africa , Banks and banking, Central South Africa , Transmission mechanism (Monetary policy) South Africa , Capital assets pricing model , Securities South Africa , Stocks Prices South Africa , Repurchase agreements South Africa
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10962/190318 , vital:44983
- Description: The asset pricing channel of monetary policy transmission breeds an interesting study. There has been an ongoing debate to determine whether monetary policy committees should directly influence the asset pricing channel through changes in the central bank control interest rate or whether monetary policy committees should refrain from targeting the asset pricing channel to meet their policy objectives. The study aims to critically analysis the asset pricing channel, firstly on a global context to set the scene and then to critically focus on the study performed by Muroyiwa et al. (2017) who conducted a study on the South African monetary policy and its interdependence on the stock market through utilisation of an SVAR model. It was concluded that monetary policy does significantly influence stock prices. The purpose of this study is to build on the results which have been formed by Muroyiwa et al. (2017) and to expand on the period under analysis which encapsulates 1999:01 to 2007:12 in order to conclude whether there are conflicting conclusions or conclusions which build on what has already been done. The results from the research shows that when the monetary policy committee decides to influence changes in the repo rate, the repo rate will have a direct effect on the asset markets, the indexes that were used to represent the asset market are the all share index, industrial 15 index and the financial 15 index. Furthermore. The study which has expanded the period under analysis has supplemented and built on the results provided by Muroyiwa et al. (2017). , Thesis (MCom) -- Faculty of Commerce, Economics and Economic History, 2021
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- Date Issued: 2021-10
Market timing and portfolio returns: an empirical analysis of the potential profitability of buy-sell strategies, based on South African equities 2009-2018
- Authors: Mulweli, Ramulongo
- Date: 2020
- Subjects: Johannesburg Stock Exchange , Stocks -- Charts, diagrams, etc. , Investment analysis -- South Africa , Stocks -- South Africa , Stocks -- South Africa -- Cast studies
- Language: English
- Type: text , Thesis , Masters , MCom
- Identifier: http://hdl.handle.net/10962/144487 , vital:38350
- Description: South Africa’s financial markets have become larger and more complex over recent decades. The number of market participants who are using technical analysis techniques to predict the market’s movement has been growing rapidly. This research aims to investigate if historical share prices can be used when forecasting the market’s direction and to examine the profitability of the Japanese candlestick patterns. The study is based on ten companies selected from the JSE top 40 2019 composition. These are Aspen Pharmacy Holding, Capitec Bank Holding LTD, Discovery LTD, Kumba Iron Ore LTD, Mondi PLC, Mr. Price Group LTD, MTN Group LTD, Naspers LTD, SASOL LTD, and Shoprite Holdings LTD. These were selected from the JSE top 40 based on market capitalization and sector. This research analyzes eight candlestick reversal patterns; four are bullish patterns namely: doji star, hammer, bullish engulfing and the piercing lines and the other four are bearish patterns namely: shooting star, hanging man, bearish engulfing and the dark cloud cover. The ARCH and GARCH models are used to test for correlation between past share prices and future share prices and the binomial test and the mean return calculations were used to test the profitability of candlestick patterns. The sample is from Thomson DataStream 2019 and IRESS SA 2019 and covers ten years with 2496 observations starting from 02 January 2009 to 31 December 2018. The findings from the ARCH and GARCH tests revealed that there is a serial correlation between the returns from the previous day and the returns for the current day. The results from the mean returns and the binomial tests show strong evidence that the shooting star, hanging man, bearish engulfing and the bulling engulfing are statistically significant in predicting the share price movements. On the other hand, there was no evidence that the dark cloud cover, piercing lines, and the bullish doji can predict share price movements. Additionally, further studies on this topic could be improved by adding different candlestick patterns and the total number of companies analyzed. The results could also be improved by analyzing the candlestick reversal patterns when they are used with other trading rules such as support resistance levels and oscillators.
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- Date Issued: 2020
Active vs passive portfolio management: an empirical analysis of selected South African equity funds
- Authors: Mphahlele, Phaswane Moatlegi
- Date: 2019
- Language: English
- Type: text , Thesis , Masters , MCom
- Identifier: http://hdl.handle.net/10962/97846 , vital:31493
- Description: Expected release date-April 2020
- Full Text: false
- Date Issued: 2019
The effect of interest rates on investment spending: an empirical analysis of South Africa
- Authors: Dakin, Nicholas John
- Date: 2016
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1131 , http://hdl.handle.net/10962/d1021174
- Description: This thesis investigates the nature and strength of the relationship between short-, medium-, and long-term real interest rates and capital investment spending at both the aggregate and disaggregate levels in South Africa in order to determine whether changes in the real interest rate affect the level of capital investment in the economy. This thesis used quarterly data for the period 1987 to 2013. VAR modelling, variance decompositions, impulse response functions and Granger causality tests are used to explore the nature and strength of the relationship between interest rates and investment spending. It is found that interest rates explain very little of the variation in investment spending and seem to have little impact on investment (of any type). Furthermore, short-, medium- and long-term interest rates have different effects on the level of investment spending. A rise in short-term interest rates appears to decrease the level of investment spending in the long-run, whereas a rise in long-term interest rates results in an increase in investment.
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- Date Issued: 2016
Recent developments in banking supervision and the soundness of the financial system : a comparative study of South Africa, Brazil and China
- Authors: Gutu, Taurai Fortune
- Date: 2015
- Subjects: Basel III (2010) , Bank management -- South Africa , Bank management -- Brazil , Bank management -- China , Global Financial Crisis, 2008-2009 , Ratio analysis , Liquidity (Economics)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1130 , http://hdl.handle.net/10962/d1020892
- Description: While the 2008 financial crisis has come and gone, its effects on the global financial sector still show. Globalisation has since changed the way that banks do business, and increased competitiveness and with it the level of risk within the international banking community. Therefore, because of these prolonged effects of the financial crisis and the rise in the level of risk in banking, regulators deemed it fit to make the global financial sector safer and sounder. As a result, the BASEL III Capital Accord was introduced with tighter capital adequacy and liquidity ratio requirements; as well as also introducing the leverage ratio. In this paper, through the study of the rules and regulations on banks in South Africa, Brazil and China, it was discovered that all three countries have since begun the implementation of the new Accord as from January 2013. While preparatory measures may be different, there is a general sense of regulatory alignment among the three countries. By analysing the capital adequacy, liquidity and leverage ratios of the three countries, it was also established that these ratios are interconnected, with the capital adequacy ratio being the most important one. The study concludes that, with proper implementation of these ratios and effective management, countries implementing the BASEL III regulations would be in a stronger position to achieve soundness in their banking systems. , Gutu, Taurai Fortunate
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- Date Issued: 2015
International joint ventures and firm value: an empirical study of South African partner firms
- Authors: Mangwengwende, Tadiwanashe Mukudzeyi
- Date: 2013
- Subjects: Joint ventures Joint ventures -- South Africa Business enterprises -- Valuation International business enterprises
- Language: English
- Type: Thesis , Doctoral , PhD
- Identifier: vital:1033 , http://hdl.handle.net/10962/d1004174
- Description: This study investigates international equity joint ventures (IJVs) and South African partner firm value creation at formation. In addition, it tests whether four contentious formation characteristics, namely, the geographical location of the IJV partner, the level of economic development in the IJV partner’s home country, the level of equity held by the South African firm and the industry of the South African firm, can explain when South African IJVs are value enhancing and when they are value diminishing. IJVs are a popular business mode and an important channel for infrastructure and skills investment in developing countries. However, despite their popularity and potential social benefits, these IJVs are predominantly created by the decisions of private firms to collaborate with foreign firms and governments. Consequently the preservation and development of the IJV investment channel is dependent on the encouragement of private firm IJV participation. It is at uncovering potential tools to encourage IJV participation by South African firms that IJV firm value creation becomes important because it stands as a motivator for South African firms’ involvement in IJVs. Existing literature on IJVs and partner firm value has presented conflicting evidence with support for the views that they are value enhancing, value diminishing or of no immediate consequence to their partners’ firm value. Consequently, previous research offers limited firm value support for IJVs. For South African firms considering joint ventures and national policy makers determined to promote IJVs there is a need for an investigation of South African partner IJV firm value effects. Moreover, it is also necessary to test potential explanatory variables that may help to explain when the IJVs are value enhancing and when they are not as this will inform IJV contract negotiations and how limited national government resources are used to promote IJVs. In order to assess firm value creation for South African firms this study performed event studies on IJV formation announcements from 1998 to 2011 using daily share returns from the Johannesburg Securities Exchange taking care to incorporate recent developments in the event study methodology. The study found that while the market responds to IJV announcements, its responses do not, on average, reflect that IJVs are firm value enhancing for their South African partners at formation. This stands in contrast to considerable empirical literature and IJV firm value creation theory. In addition, factoring in formation characteristics, argued to potentially help explain cases of value creation and destruction from IJVs, provided limited explanation for positive and negative wealth effectsfor South African firms entering IJVs. This result has important value for IJV participants, national economic policy makers and IJV researchers. For IJV participants and national policy makers, the results caution unfettered entry/support for IJVs and challenge the role of equity distribution in determining the value of the IJV to its partner firms. For IJV researchers, the results present new evidence questioning IJV firm value creation at formation and provide a potential explanation for the conflict in previous IJV research. The study makes four key contributions to the existing knowledge of IJV firm value creation. Firstly, it assesses IJV wealth effects for the hitherto untested South African IJVs. Secondly, in doing so it adds a new data set (South African IJVs) to the current IJV literature. Thirdly, in reviewing the literature on IJV firm value creation the study presents a disaggregated model of IJV firm value creation from which to develop IJV research and potentially solve the persistent conflict in empirical results on IJV partner wealth effects. Finally, it informs future South African IJV agreements by uncovering factors that influence and do not influence partner wealth effects for South African firms.
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- Date Issued: 2013
Interest rate pass-through in Cameroon and Nigeria: a comparative analysis
- Authors: Tita, Anthanasius Fomum
- Date: 2012
- Subjects: Interest rates -- Cameroon Interest rates -- Nigeria Interest rates -- Effect of inflation on -- Cameroon Interest rates -- Effect of inflation on -- Nigeria Interest rates -- Econometric models Cointegration Monetary policy -- Cameroon Monetary policy -- Nigeria Banque des états de l'Afrique centrale Banks and banking -- Cameroon Banks and banking -- Nigeria
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1005 , http://hdl.handle.net/10962/d1002740
- Description: One of the most important aspects of monetary policy is an understanding of the transmission process: the mechanism through which the monetary policy actions of the Central Bank impact on aggregate demand and prices by influencing the investment and consumption decisions of households and firms. Thus, commercial banks are regarded as conveyers of monetary policy shocks and are expected to adjust retail interest rates in response to policy shocks one-to-one. In practice, commercial banks adjust their retail rates in response to changes in monetary policy with a lag of several months and this delay is often viewed as an impediment on the ability of the Central Bank to steer the economy. Several reasons, such as credit rationing and adverse selection, switching costs, risk sharing, consumer irrationality, structure of the financial system, menu costs and asymmetric information are some of the causes advanced for commercial banks retail rates being sticky. In spite of the important role of pass-through analysis in the monetary policy transmission process, it has received very little attention in Sub-Saharan Africa, especially in Cameroon and Nigeria, which have implemented a series of reforms. To this end, this study gives a comparative analysis of interest rate pass-through in Nigeria and Cameroon using retail rates (lending and deposit) and a discount rate (policy rate) from January 1990 to December 2010 for Nigeria and from January 1990 to June 2008 for Cameroon. The study examines the magnitude and speed of retail rate adjustments to changes in the Central Bank policy rate as well as examining the possibility of symmetric and asymmetric pass-through in both countries. In addition, the study also investigates whether there is pass-through of monetary policy from one country to the other. The empirical analysis employs four different types of co-integration techniques to test the presence of a long run co-integrating relationship between retail and the policy rates in order to ensure that the relationship detected is robust. Three sets of analyses are carried out in the study. Following Cottarelli and Kourelis (1994), the study employed a co-integration technique, firstly, to analyse pass-through for the entire sample, secondly, to analyse symmetric and asymmetric pass-through using a ten year rolling window analysis in an error correction framework. Finally, the policy rates were swapped around to investigate if there are transmissions of impulses from one country to the other. Overall, evidence from the entire sample and rolling window analysis suggests that monetary policy in Cameroon is less effective. This is perhaps one of the reasons why the Banque Des Etats De L’Afrique Centrale (BEAC) is unable to sterilise the excess liquidity of the banking sector in Cameroon. The long run pass-through of 0.72 and 0.71 for the entire sample, and the average long run pass-through for the rolling window of 0.78 and 0.76 for the lending and deposit rates, suggest that monetary policy is highly effective in Nigeria compared to Cameroon. The empirical evidence confirmed asymmetric adjustment in six rolling windows in the lending rate in Nigeria. Three rolling windows indicated that the direction of rigidity is downward, supporting Scholnick’s (1996) collusive pricing arrangement between banks, and the other three suggested that the lending rate is rigid in the upward direction, corroborating Scholnick’s (1996) customer reaction hypothesis. The deposit rate in Cameroon was also found to adjust asymmetrically and the direction of rigidity is downward, supporting Hannan and Berger’s (1991) customer reaction hypothesis. The investigation of impulse transmission between the two countries revealed that only the policy rate in Nigeria exerts some influence on the deposit rate in Cameroon. Policy recommendations are also discussed.
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- Date Issued: 2012
The relationship between bank concentration and the interest rate pass through in selected African countries
- Authors: Mangwengwende, Tadiwanashe Mukudzeyi
- Date: 2010
- Subjects: Interest rates -- Effect of inflation on -- Africa , Monetary policy -- Africa , Prime rate , Prime rate -- Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:942 , http://hdl.handle.net/10962/d1002675
- Description: Given the importance of monetary policy in the operation of a successful modern economy and the use of official interest rates as tools in its implementation, this study investigates the implications of changing bank concentration on the operation of the Interest Rate Pass Through (IRPT) of official rates to bank lending and deposit rates. This is an issue made more poignant by growing mergers, acquisitions and bank consolidation exercises around the world that have brought interest to their implications for economic performance. However, with contention high in the industrial organisation theory on the likely relationship between bank concentration and the IRPT, and the outcomes of empirical investigations producing conflicting evidence, the desire to investigate the issue in the African context necessitated a thorough empirical investigation of four African countries (South Africa, Botswana, Nigeria and Zambia). This study not only extended the investigation of the issue to the African context, but it merged different IRPT measurement techniques that had not been jointly applied to this particular issue, namely; Symmetric and Asymmetric Error Correction Models, Mean Adjustment Lags, Ordinary Least Squares estimations and Autoregressive Distributed Lag models. These measures of the IRPT were compared with three firm concentration ratios on two different levels of analysis, one, over the entire period and, another, through eight year rolling windows. The results reveal that bank concentration can sometimes be related to the speed and magnitude of the IRPT but that these relationships are not consistent amongst the countries, over the entire sample period or across the two levels of analysis, suggesting reasons why empirical results have arrived at contrasting conclusions. The results revealed more evidence of a relationship between bank concentration and the magnitude of the IRPT than between bank concentration and the speed of the IRPT. Furthermore, where relationships were identified there was evidence supporting both the structure conduct performance hypothesis and the competing efficient market hypothesis as the true representation of the relationship between bank concentration and the IRPT. The key implication of the result for African countries is that increased bank concentration through bank consolidation programmes should not be automatically regarded as detrimental to the effective implementation of monetary policy through the IRPT. Consequently,banking sector regulation need not stifle bank consolidation and growth to preserve monetary policy effectiveness. Rather, since the relationship cannot be neatly represented by a single theory or hypothesis each country must determine its own interaction between bank concentration and its IRPT before policies regarding the banking sector concentration and effective monetary policy, through the use of official interest rates, are determined.
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- Date Issued: 2010
A comparative analysis of the divisia index and the simple sum monetary aggregates for South Africa
- Authors: Moyo, Solomon Simbarashe
- Date: 2009
- Subjects: Monetary policy -- South Africa , Money supply -- South Africa , Inflation finance -- South Africa , Index numbers (Economics)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:945 , http://hdl.handle.net/10962/d1002679 , Monetary policy -- South Africa , Money supply -- South Africa , Inflation finance -- South Africa , Index numbers (Economics)
- Description: The effectiveness of monetary policy in achieving its macroeconomic objectives such as price stability and economic growth depend on the monetary policy tools that are implemented by the Central Bank. Monetary aggregates are one of the tools that have been used as indicators of economic activity and as intermediate targets to achieve these economic objectives. Until recently, monetary aggregates have been questioned and criticised on their usefulness in monetary policy. This has been attributed to the economic, financial and technological developments that have distorted the relationship between monetary aggregates and major macroeconomic variables. This study investigates the relevance of monetary aggregation by comparing the traditional simple sum and Divisia index monetary aggregates which was constructed for the first time for South Africa using the Tornquist-Theil method. The Polynomial Distributed Lag model is employed to compare the performance of these monetary aggregates using their relationship with inflation and manufacturing index. Furthermore, the aggregates are compared in terms of their controllability and information content. Overall, the study found a very strong relationship between inflation and all the monetary aggregates. However, more specifically the results suggested that the Divisia indices are superior to the simple sum in terms of predicting inflation. The evidence further suggests that the Divisia aggregates provide higher information about inflation than the simple sum aggregates. Regarding the controllability of the monetary aggregates, the findings suggest that the monetary authorities can hardly control the monetary aggregates using monetary base. Finally, the relationship between manufacturing index and all the monetary aggregates was very weak.
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- Date Issued: 2009
The term structure of interest rates and economic activity in South Africa
- Authors: Shelile, Teboho
- Date: 2007
- Subjects: Finance -- South Africa , Monetary policy -- South Africa , Interest rates -- South Africa , Economic development -- South Africa , South Africa -- Economic conditions -- 21st century
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:994 , http://hdl.handle.net/10962/d1002729 , Finance -- South Africa , Monetary policy -- South Africa , Interest rates -- South Africa , Economic development -- South Africa , South Africa -- Economic conditions -- 21st century
- Description: Many research papers have documented the positive relationship between the slope of the yield curve and future real economic activity in different countries and different time periods. One explanation of this link is based on monetary policy. The forecasting ability of the term spread on economic growth is based on the fact that interest rates reflect the expectations of investors about the future economic situation when deciding about their plans for consumption and investment. This thesis examined the predictive ability of the term structure of interest rates on economic activity, and the effects of different monetary policy regimes on the predictive ability of the term spread. The South African experience offers a unique opportunity to examine this issue, as the country has experienced numerous monetary policy frameworks since the 1970s. The study employed the Generalised Method Moments technique, since it is considered to be more efficient than Ordinary Least Squares. Results presented in this thesis established that the term structure successfully predicted real economic activity during the entire research period with the exception of the last sub-period (2000-2004) when using the multivariate model. In the periods of financial market liberalisation and interest rates deregulation the term structure was found to be a better predictor of economic activity in South Africa. These findings emphasise the importance of considering the prevailing economic environment in testing the term structure theory.
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- Date Issued: 2007
The nature and potential of industrial development within the Southern African Development Community (SADC) and the facilitating role of trade liberalisation and foreign direct investment in selected countries
- Authors: Mutambara, Tsitsi Effie
- Date: 2005
- Subjects: Southern African Development Community Investments, Foreign -- Africa, Southern Free trade -- Africa, Southern Economic development -- Africa, Southern Industrialization -- Africa, Southern Industrial policy -- Africa, Southern Africa, Southern -- Economic policy
- Language: English
- Type: Thesis , Doctoral , PhD
- Identifier: vital:1071 , http://hdl.handle.net/10962/d1007732
- Description: To date the SADC region has managed to develop a manufacturing base but this base is still small as evidenced by its low contribution to GDP. For example, only three out of the fourteen SADC countries, viz. Mauritius, South Africa and Swaziland, had over 20 percent of their GDP originating from the manufacturing sector throughout the 1990s. Also to note is that while the manufacturing sector is quite diversified, the sector is dominated by industrial processes which are more of resource and labour-intensive in nature than those processes of scale-intensive, differentiated and science based in nature. TIle trade performance of the manufacturing sector supports these observations and as such the region is heavily dependent on imports for scale-intensive, differentiated and science based commodities. However, despite the fact that the region tends to focus more on resource- and labour-intensive manufacturing activities, products from these manufacturing activities are still significant components of manufactured goods imports into the region. Also to note is that since resource- and labour-intensive industries dominate manufacturing activities; these are the areas in which investment opportunities abound. For example, agro-based manufacturing presents most of the investment opportunities, with food processing presenting the majority of the investment opportunities followed by garments and textiles production. Mineral processing also presents significant investment opportunities. The analyses of the nature of the manufacturing sector also show that in a few SADC countries, viz. Mauritius, South Africa and Zimbabwe; scale-intensive, differentiated and science based industries also form a significant component of the industrial base implying more technologically complex manufacturing sectors. Since high technology and technologically complex manufacturing activities are limited, investment opportunities in these manufacturing sub-sectors are also limited to just a few countries However, with the SADC ITA in place, opportunities could arise for these limited technology-related manufacturing facilities to expand or engage in import substitution production so as to meet the demands of the growing regional market. It is also important to note that, while the region may not have as competitive advantage in these industries as in the resource- and labour-intensive industries, there is a need for the region to selectively identify and target such industries for priority development, a lesson SADC could learn from the East Asian NIC's took in their industrialisation strategy. The study also shows that the manufacturing sector has been a priority sector for both domestic and foreign investors. This has implications for industrial development because a strong and dynamic manufacturing sector would be developed, forming a sound basis for industrialisation as well as being able to effectively link and support all the other sectors of the economy. FDI could help the region to fully utilise the labour-intensive industries and use them as a stepping-stone to higher levels of industrial development. This is a lesson to SADC from the experiences of the East Asian NICs where while industrialisation was initiated by labour-intensive manufacturing, the countries were able to move into capital-intensive manufacturing due to FDI as it enabled the establishment of the industrial bases, thus leading to a rise in the share of manufactured exports. FDI could also help to develop the resource-intensive industries further by promoting further processing of raw materials into products of more value, thus propelling industrialisation through a resource-led industrial development programme as the current resource-intensive industries become fully utilised. The raw materials which occur in great abundance in the region's primary sector would have a ready market in the manufacturing sector where they would serve as inputs to the production of high value products. The currently smaller industrial base for scale-intensive products, differentiated and science-based manufactured products would benefit from the improved technological capabilities and managerial skills that result from FDI. Therefore, by impacting positively on manufacturing activities of both low and high MVA, FDI would thus have a facilitating role in establishing a more solid industrial base, broadening the current manufacturing base, and improving installed capacity utilisation. The study also shows that investment in productive capacity in the form of machinery and equipment is of great importance in the sampled SADC countries. Investment towards the acquisition of this capital is very important as this is directly relevant towards improving productive capacity. FDI could thus play a facilitating role by augmenting the current domestic investment in machinery and equipment. While the manufacturing sector within the region is still small and the current utilisation of installed industrial capacity is low, there is potential for further industrial growth. The current process to usher in the SADC Free Trade Area would have a facilitating role through various ways: viz. increasing the market size and enabling easier access through the reduction of tariff and non-tariff barriers, promoting regional competitiveness, improved utilisation of regional corridors, increasing opportunities for utilising identified intra-industry trade potentials, and providing opportunities for increased regional cross-border investment. Apart from the SADC FTA, the USA African Growth and Opportunity Act (AGOA) and the Cotonou Agreement will also motivate the identification and utilisation of existing and new potentials within the manufacturing sector in SADC. In order to improve the current nature of industries in the region, there is also a need to design and implement appropriate industrial policies and strategies. Such policies should consider the region's trade policies and the recently launched Regional Indicative Strategic Development Plan (RISDP) so as to complement them. The industrial policies should also address issues relating to industrial investment, technology and local technological capabilities development, human resources development, the structure and nature of industry, the competitiveness of industries, as well as facilitating the complementarities between the agricultural and manufacturing sectors. To this end therefore, instead of relying solely on individual national industrial policies, SADC is in the process of formulating a regional industrial policy and strategies which seek to promote and support sustainable industrial growth across the region, thus facilitating industrial development.
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- Date Issued: 2005
Aspects of the new repurchase system of monetary control in South Africa
- Authors: Springfield, Samantha Claire
- Date: 2001
- Subjects: Monetary policy -- South Africa Credit control -- South Africa
- Language: English
- Type: Thesis , Masters , MEcon
- Identifier: vital:940 , http://hdl.handle.net/10962/d1002673
- Description: The main objective of monetary policy is to protect the value of the currency, and in so doing, achieve the objectives of maximum economic growth, development, and the creation of employment opportunities. As from 1985, under the advice of the De Kock Commission, the South African Reserve Bank (SARB), implemented the classical cash reserve system of monetary control. Under this system, the SARB was willing to refinance the money market shortage fully, automatically, and on certain predetermined terms, conditions and costs. However, since the new political dispensation in 1994, South Africa’s financial markets have become more globalized, liberalised, and integrated. Thus, the classical cash reserve system had lost its usefulness, and was no longer effective. As from March 1998, the SARB implemented the new repurchase system of monetary control. In implementing the repurchase system of monetary control, South Africa was adopting a more eclectic approach. This system is aimed at making monetary policy more effective and more flexible in a financial environment filled with complexities. This study finds that the repurchase system has thus far been successful in meeting its objectives. Interest rates are more flexible and sensitive to developments in the domestic and external environment, the signalling mechanism of the SARB has proved to be successful, accommodation and interest rates are closely related and the interbank market has become more developed. Therefore, the repurchase system appears to be more efficient than the previous system of monetary control in South Africa.
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- Date Issued: 2001
Clustering as a strategy for manufacturing performance in the Eastern Cape Automotive industry
- Authors: Makuwaza, Gwynneth Chandakaita
- Date: 2001
- Subjects: Automobile industry and trade , Automobile industry and trade -- South Africa -- Eastern Cape , Automobile industry and trade -- South Africa -- Eastern Cape -- Performance
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:937 , http://hdl.handle.net/10962/d1002670 , Automobile industry and trade , Automobile industry and trade -- South Africa -- Eastern Cape , Automobile industry and trade -- South Africa -- Eastern Cape -- Performance
- Description: South Africa's current industrial policy focuses on the economy at two levels: a sectoral and spatial level. The former relates to the manner in which industrial policy is concentrating on particular sectors i.e. industrial clusters. This shift in industrial policy from targeting individual industries to an emphasis on industrial clusters, has complemented the change in focus to export promotion under trade policy. Furthermore, there has been increasing recognition of the need to improve industry performance and competitiveness in order to successfully implement export growth. Industry clusters are considered as having the potential to increase manufacturing performance and can provide the basis for sustainable competitive advantage for nations. Consequently the concept of industry clusters was introduced in South Africa in 1997. Because industry clusters are relatively new in South Africa, most of the cluster initiatives in various sectors of the economy are in their early stages of development. Nevertheless, some are already showing signs of potential success in increasing competitiveness in particular sectors. This thesis uses Porter's "diamond" framework apprdach to investigate whether clustering has improved the manufacturing performance of the motor industry in the Eastern Cape. International experience from both developed and developing countries will illustrate the potential of clustering as a powerful strategy in increasing manufacturing performance and consequently competitiveness. Ultimately this should lead to long-term economic development, especially if government adopts clusterbased economic development policies. Information from a survey conducted on both the motor vehicle assemblers and component suppliers is used in this study. The findings reveal that it is mainly the motor vehicle assemblers who have experienced some improvements in manufacturing performance. The components sector on the other hand has not experienced any such improvements. This thesis concludes with the recommendation that it is important to develop cluster policy as a broader and dynamic view of competition. The main emphasis under such policy would be a move from targeting particular industries and providing subsidies towards focusing attention to all clusters in the economy. To effectively apply such a policy requires the repositioning of national, local and provincial government in order to become more involved in regional development issues. Moreover, the various levels of government need to incorporate cluster policy into their competitive strategies.
- Full Text:
- Date Issued: 2001
Violence and destruction as an important part of artistic action with reference to the two Great Wars
- Authors: Hallier, Michael Glen Thomas
- Date: 1971-11
- Subjects: Uncatalogued
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10962/190329 , vital:44984
- Description: A well known fact about any work of art of any significance is its power to upset current conventions and disturb certain of our normal emotional patterns. The artist frequently achieves this by deliberately expressing emotions that are violent. There is nothing, however, new about the existence of violence in the arts, a large number of works in the history of art being painted with blood. One has only to think of the many battles, rapes, murders, martyrdoms and catastrophes that have been the subjects of many great paintings. Since the beginning of this century, and especially since the work of the Impressionists, in which violence is entirely excluded, violence has taken on a role of great importance and has been used to a greater or lesser extent by artists and group movements. It would appear initially that there are two main reasons in this century for the use of violence: one as a means of using it as a weapon against the academic and avant-garde in the arts, which in turn reflects attitudes found in society, and secondly as a direct reflection of the corrupt society in which we live. This is not to say that the twentieth century is an age in which more violence and sadism is found than in any other era of history, but never has it received so much publicity. I do not believe that man has change so much over the years, but it is my view that the apparent increase in this century is due to the vast changes in communications, it is due to the publicity it receives that violence has in recent times become a focal point, with murders, assassinations and war part of our daily lives. , Thesis (MFA) -- Faculty of Humanities, Fine Art, 1971
- Full Text:
- Date Issued: 1971-11