South Africa exports of metal and articles of base metal : a gravity model approach

Abstract

Using a gravity model, this study estimates trade potential of the metals and articles of base metal sector (SIC 72-83) for the period 1995 to 2004 between South Africa and 33 countries. The analysis shows that importer's GDP, exporter's GDP, exporter's population, membership of SADC and being part of Africa are associated with an increase in exports of metal products. Distance is associated with a decrease in metal exports. Importer's population does not have a significant impact on exports of metal and articles of base metal products. The study finds that that among others, Canada, Hong Kong, India, Mozambique, Republic of Korea, United Kingdom and Zimbabwe, have the biggest unexploited trade potential. It is important for trade analysts and policy makers to ensure that South Africa’s trade potential is fully exploited to enhance economic growth.