Industrial policy advocates typically present manufacturing growth as key to long-run job creation. However, in SA, manufacturing is dominated by heavy industry, which neither generates employment nor supports self-employment on a significant scale. Unless that dominance is challenged by accelerated growth in light industry, agriculture and services, SA will not shift its world-beating deficit in employment creation.

SA’s export profile underscores its weakness in light industry. In 2019 clothing contributed 1.3% of SA’s goods exports, electronics 1.5%, and machinery and appliances 9.2%. As a group, that comes to just more than a tenth. Even excluding China, for other upper-middle-income countries, clothing made up 3.5% of goods exports, electronics 10% and other equipment 20% — a third of the total. For China, these products groups contributed 85%...

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