A tough balancing act : a discussion of free trade and protectionism through the lines of South Africa and the WTO anti-dumping agreement.

Abstract

There have been many examples and cases where countries have used the provisions of the Anti-Dumping Agreement in an advantageous yet unfair manner. As a result, there is a conflict emerging out of the fact that these states have an obligation to comply with the core principles of the World Trade Organisation (WTO), especially the principle of non-discrimination and free trade in the global community, while employing anti-dumping measures or engaging in protectionism. The WTO encourages as one of its main objectives free trade, which encourages member states to lower trade ‘guards’ or trade barriers in an attempt to facilitate trade between countries. The advantage of this is to promote competition between member states. The legal document under scrutiny is the Anti-Dumping Agreement (ADA), which is a WTO agreement that was established to ‘focus on how governments can or cannot react to dumping’ in their countries. The Agreement permits government(s) to act against such activities where there is genuine and actual injury to the domestic industry. If not strictly applied within parameters, the ADA procedures can become effective barriers to trade, which would bring it in conflict with the core principle of free trade, which advocates (as briefly mentioned above) that countries should practice trade in a way that is free of barriers. It has been said that an economy ‘promoting free trade enhances competition within industries which in turn yields greater efficiency and better products particularly in domestic companies’ (Krueger 1990, p 68). Countries that are member states of the WTO have a mandatory obligation to comply with the principles of the WTO, which include promoting free trade and refraining from imposing unnecessary barriers to trade. One of the main users of barriers to trade in the form of anti-dumping duties and other protectionist tools is South Africa, which has become a prolific user of anti-dumping duties in recent years. This research thus attempts to rekindle WTO obligations within South Africa, while also being cognisant of the fact that protectionist policies can still be used, albeit in a justified manner.