Customs and Excise last week said that SA exports to Europe fell by 10.4% to R166 billion in 2012 compared with a 20.4% rise to the rest of Africa outside the Southern African Customs Union (SACU). Overall exports to non-SACU members grew by only 0.8% to R718 billion.
Yves Zlotowski‚ Coface chief economist‚ said one of the major hurdles facing countries in the eurozone in 2013 could be political challenges such as the elections in Italy‚ pressure from the political left in Germany and the Greek government dealing with austerity measures.
Zlotowski said austerity measures should have been implemented far slower to be more effective. He warned that there is a risk that politicians may be distracted by political issues rather than addressing their weak economies. Many need to implement much-needed structural and regulatory changes to address their ever-increasing sovereign debt levels‚ unemployment and stagnant growth.
"Trade-restricting measures taken since the beginning of the financial crisis include anti-dumping investigations and more stringent customs procedures‚" said Marc Auboin‚ economic counselor in charge of trade and finance‚ and international economic policy coherence‚ WTO.
"The sectors most affected by restrictive measures are iron and steel‚ plastics‚ organic chemicals‚ rubber products‚ man-made staple fibres‚ and vegetables and fruits‚" he said.
Ireland currently has the eurozone's best GDP growth‚ projected at 3.2% for 2013‚ and was achieving this through a reduction of wages and prices.
Ireland also had the highest value add in the manufacturing sector followed by Finland and Germany. The bottom three countries are Greece‚ then France and Spain.
Another important recovery factor was to increase household expenditure. Despite the household debt burden‚ the potential for increasing household expenditure does exist.
Domestic demand has fallen off significantly since 2008 with France and Spain experiencing the greatest reduction followed by Greece‚ Italy and Portugal.
Coface noted that within the eurozone‚ Italy has the second highest household net wealth of about 180% as a percentage of GDP after Belgium. This meant that Italian households still have disposable income but they are just not spending.
Netherlands‚ France and Germany are just below Italy at a range of 180% to 125%. Greece and Spain are at 40% and 55% respectively‚ which are regarded as low and a reflection of the domestic crisis in these countries.
Coface estimated that although Italy‚ Spain‚ France‚ Netherlands‚ Portugal and Greece would continue to show negative growth in 2013‚ the growth would be a marginal improvement over 2012.
Greece is expected to show a 4.5% decline in 2013 compared to with a 6.5% fall in 2012.
In addressing the eurozone crisis‚ governments should be cautious about selling assets to foreign governments and companies. This could pose longer-term challenges. It is not the ideal strategy to sell a country's strategic assets to foreigners to reduce debt.
Overall‚ Coface expected the eurozone to remain weak and contract by 0.1% in 2013 compared with a 0.3% reduction estimated for 2012‚ showing a marginal improvement. Countries projected to show positive growth‚ but less than 1.1% include Germany and Belgium.
In Europe‚ high-risk sectors for 2013 are retail‚ metals‚ agro-food‚ services and construction. Medium risk industries are wood-paper‚ transportation‚ textile-clothing‚ automobile‚ mechanicals and electronic IT. Moderate risks sectors are energy‚ chemicals and pharmaceuticals.
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