South African manufacturing industries catching up or falling behind?

Abstract

This article argues that intra‐industry trade with developed countries is an important source of technology transfer. South Africa has an industrial structure that is suited to such trade, but high costs and weak social capacity to assimilate new technology. Therefore, reintegration into the world economy is likely to reinforce dependence on resource‐intensive industries. In the short run this need not adversely affect economic growth, but unless the quality and quantity of education and training are improved, the prospects for rebuilding the technological capacity and catch up with OECD countries are bleak.

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