Globalization, industrial development and the plastics industry in South Africa

Through a study of the plastics sector in South Africa, the article critically examines the globalization position that greater openness yields gains from exports and foreign direct investment. Analysis of firm-level data reveals that the depth and extent of the internationalization of production depends on the production capabilities of firms and their position and bargaining power in the supply-chain. It is argued that liberalization does not necessarily mean that international relationships will be deepened and that a coherent industrial policy is important in the realization of the potential gains from such internationalization.