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Thread: Protection can make companies lazy

  1. #1
    Site Caretaker Dave A's Avatar
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    Protection can make companies lazy

    Feel this one over for catches. Do you see what I see?
    Protection can make South African companies lazy, South African Finance Minister Trevor Manuel told the Lion of Africa breakfast on Thursday.

    Replying to a question about incentives planned for business owners and another question about what encouragement would there was in Wednesday's budget for exporters, particularly in the clothing and textile industry, Manuel said the government will continue to engage business to ensure that they understand the need to support the local textile industry.

    "Part of what we must do is engage with South African business to ensure that they too understand that they can take the world on.

    "There are many parts of the global economy where our manufacturing sector has actually niched very successfully. In an environment where you have a far more stable exchange rate ... it is getting that message through."

    He emphasised that China -- predominant in the textile industry -- is not "all things, to all people, for all time. You can get right up to their doorstep ... their veranda".

    Protection is not something in a budget -- it would be something within the trade agreements -- but the big risk is that protection "often makes companies lazy".

    He noted that he was recently in South Korea where he met salesmen who were selling South African textiles. "That spirit is better than anything the government can say. That is the spirit."
    story from M&G here
    The trouble with opportunity is it normally comes dressed up as work.

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    just me duncan drennan's Avatar
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    I've never had the impression that Trevor or Tito like the trade protection agreements. I think they are both all for free market. You might argue that if Trevor was all fro free market he would remove the exchange controls totally, but I think the way he has gone about things has been a gradual change so that there are not shocks to the market or the economy.

    How else can that statement be read??
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    Site Caretaker Dave A's Avatar
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    Think BEE.
    The trouble with opportunity is it normally comes dressed up as work.

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    just me duncan drennan's Avatar
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    Quote Originally Posted by Dave A View Post
    Think BEE.
    Hmmm....tax benefits for BEE deals were dished out in the budget speech, so I'm not sure that could be interpreted from that perspective.

    Tito doesn't give the impression of being big on the BEE/AA thing. Reading too much into it, or am I missing your point?
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    Site Caretaker Dave A's Avatar
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    BEE is a form of protection?
    The trouble with opportunity is it normally comes dressed up as work.

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    just me duncan drennan's Avatar
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    Quote Originally Posted by Dave A View Post
    BEE is a form of protection?
    I get what you are thinking, but I just don't see it implied in any way in the comments, or in their actions.
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    Site Caretaker Dave A's Avatar
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    Maybe BEE is considered reasonably fair protection. Still doesn't mean it won't make the beneficiaries lazy. Which was the whole point of including the Indonesian case study in the BEE submission.
    The trouble with opportunity is it normally comes dressed up as work.

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    just me duncan drennan's Avatar
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    Quote Originally Posted by Dave A View Post
    Maybe BEE is considered reasonably fair protection. Still doesn't mean it won't make the beneficiaries lazy. Which was the whole point of including the Indonesian case study in the BEE submission.
    From the perspective of making people lazy, yes I do agree with you. Protection leads to complacency (in the long run at least).
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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by dsd View Post
    From the perspective of making people lazy, yes I do agree with you. Protection leads to complacency (in the long run at least).
    I think that means we agree with Trevor - so I take it we are all agreed.

    From there:
    We can't run the risk of making the the textile industry lazy, but for BEE beneficiaries it's OK?

    Just one of those idle thoughts that flashes through my brain when I read stuff.
    The trouble with opportunity is it normally comes dressed up as work.

  10. #10
    just me duncan drennan's Avatar
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    Quote Originally Posted by Dave A View Post
    We can't run the risk of making the the textile industry lazy, but for BEE beneficiaries it's OK?
    That appears to be the message....
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