DO YOU THINK BUY SOUTH AFRICAN POLICY IS APPROPRIATE FOR SOUTH AFRICA?
Buy-South-Africa-Policy is not only appropriate it is the best thing that any South African can do to their country and to themselves. Buying ones’ own national products has a positive impact on South African as a people and South Africa as a nation, first, on the national psyche of South Africans and second on the economy of South Africa. Buying South-African products encourages nationalism. Nationalism is defined simply as the love for country. Some show their love for country by an open declaration of affection towards the national flag, or towards singing one’s national anthem, or by speaking of their national pride as a people sharing a unique history and distinct culture. In some countries such as South Korea their love of country is shown by buying South Korean-made products even if they are out of their country. We can see the national confidence and pride of Koreans buying their own products. It can do the same to South Africa. Buy-South-African-Policy has a positive impact on the economy of South Africa. The policy protects local producers, increase employment, increase GDP, protects from imports and smuggling and conserve foreign exchange. (Polivello, 2008).
Protects Local Producers. Buying South African goods and services protects local producers from the surge of imported products. The challenge that this new policy places on the local producers is to maintain and improve the quality of their products and services that are competitive enough to be at par with imported products or otherwise better than them. The vital role that the South African government will play is to support local producers by adopting measures to ensure production of quality and competitive products.
Increase Employment. Patronage of South African goods and services results to higher revenues of local companies and of course higher demands of local products. The high demand of South African goods and services of course triggers the local producers to increase supply. The increase in production of goods and services demands that factors of production such as capital and labor is injected in the industry. Therefore, one of the positive impacts of patronizing South African products is a reduction of the number of unemployed which is a good thing to alleviate poverty and a good indicator of the over-all health of the economy. While there is high demand for local labor, unemployment rate is down and South Africans are kept inside their country rather than work or immigrate outside causing brain drain.
Increase in GDP. Gross domestic product (GDP) as we all know, is the aggregate amount of all goods and services produced in the country for a given period. GDP is used as an indicator of the health of an economy. Buying South African-made goods and services will increase the GDP rate of South Africa. An increase in GDP means that more goods and services are produced within the country, more people are employed, less people are poor, and more people have money since they are spending more for local products and it may also mean increase in savings.
Protects from Smuggled and Imported Goods. Buying South African quality and cheaper South African products competes against the influx of imported goods and sometimes smuggled goods that are of comparatively good quality and lower price. In some countries such as the Philippines, tax custom’s regulations encourage the proliferation of smuggled imported goods into the country. The smuggled products are of good quality and are often cheaper and compete with the local industry and sometimes kill the latter. If the South African government places adequate measures to support and protect local producers and provide incentives to South African who buy South African products. The influx of smuggled and imported goods is reduced.
Conserve Foreign Exchange. When South Africans buy South-African made products it results to a lesser volume of imported products coming into the country. Since South African’s use their own currency for buying South African-made products there is no exchange of currency as in the case when buying imported products where there is an exchange of currency at an ‘international’ level. With the new policy the South African government therefore does not need to spend money to import especially that the money spent for payment for imports come from the people (Raj, 2011). Countries with a high foreign exchange means that they can exert power in terms of closing contracts with international partners and reducing the interest rates of incurred debts (Anonymous, 2010).
In conclusion, the Buy-South-African-Products Policy has a lot more positive impacts than negative ones. In fact there are no negative impacts we can talk of. The positive impacts are again, protection of local producers, increasing employment, increasing GDP, protection from smuggled and imported goods and conservation of foreign exchange. Highly developed countries that are successful in the same policy of buying their own products as presented earlier is South Korea. Buy-your-own products policy is successful with adequate protection and support from the government that is implementing them.
REFERENCES
Anonymous, 2010. The Significance of the Foreign Exchange Reserves. [online] Available at: <http://www.liteforex.org/forex_trading_market_articles/the_significance_of_the_forign_exchange_reserves> [Accessed 10 May 2011].
Polivello, R., 2008. Buy Filipino Policy Imposed on State Firms. Manila Standard Today. [online] Available at: <http://www.manilastandardtoday.com/2008/may/31/politics3.htm> [Accessed 10 May 2011].
Raj, 2011. What Is Foreign Exchange Reserve?what Does A Huge Forex Reserve Do To A Country’s Economy? The Forex Market. Answers. [online] Available at: <http://theforexmarket.biz/what-is-foreign-exchange-reservewhat-does-a-huge-forex-reserve-do-to-a-countrys-economy-3/> [Accessed 10 May 2011].
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