Abstract:
This study investigates the trade effects of the EU-SA and SADC preferential trade agreements of which
South Africa is a member. Using a panel data estimation of the gravity model of bilateral trade and based on
data from 1994 to 2008, the study finds the EU-SA preferential trade agreement to have a significant trade
expansion effect. The study further reveals that an informative conclusion on trade effects of the SADC
preferential trade agreement can only be reached once the agreement has been fully operational. The study
also recommends that trade policy in South Africa should increasingly be geared towards broad-based
multilateral liberalisation. In addition, South Africa should promote regional economic stability and
development through supporting regional trade agreement initiatives.
