Thoughts on South African and international politics and culture

Tuesday, February 01, 2005

Exporter's Woe Misplaced?
Interesting article on the Finance24 website regarding the Rand's fortunes in January. What's interesting is that the article states that exports rose 7% in Rand terms in 2004 (25% in $ terms), reversing from a 12.7% decline in Rand terms in 2003. And for once, exporters blamed "bottlenecks on the railways and harbours" and not the Rand, for constricting their growth. One hopes that this is the end of exporters bleating about the Rand and beginning to focus on internal efficiencies to make their exports internationally competitive in the free market. I can hear the retort now, "But what would exports have been like if the Rand was weaker?", but this is spurious. The strong Rand has significant advantages to it, not least in gains in real wealth accumulation. Exporters have proved that they can achieve growth and efficiencies, so let this be the beginning of efficiency based growth as opposed to Rand-based growth. If the Rand does move weaker, it can only be to leverage higher improvements in export growth rates.