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This paper assesses the implications for upgrading of integration into two distinct clothing value chains in Lesotho and Swaziland − the value chain characterised by Taiwanese investment and feeding into the US market under the African Growth and Opportunity Act (AGOA) and the value chain characterised by South African investment and feeding into the South African market. These value chains differ with regard to ownership patterns, end markets, governance structures, retailers' demands, and investors' motivations. These different characteristics have crucial impacts on upgrading possibilities, including functional, process and 'local' upgrading. Thus, from the perspective of upgrading and sustainability, ownership patterns, local embeddedness and market diversification matter. The emergence of South Africa as an alternative end market and the different value chain dynamics operating in the South African retailer-governed value chain opens up new opportunities from those of the AGOA/Taiwanese-dominated value chain.

BARNES J. and KAPLINSKY R. (2000) Globalization and the death of the local firm? The automobile components sector in South Africa, Reg. Studies 34 , 797-812. As in the case of many developing countries, South African industry is facing a new competitive environment as trade barriers fall. This involves both the need to enter external markets and to cope with new entrants in the domestic market. In the case of the South African automobile assembly industry, responding to this new global environment has increasingly meant that domestic subsidiaries are being integrated into the global strategic operations of their parent companies. This is increasingly leading them to the foreign sourcing of components, in part because of perverse and unintended consequences of the Motor Industry Development Plan. Where local production of components is involved, there is decreasing space for locally-owned component suppliers and almost no space for component suppliers using local technology. South African component suppliers are thus increasingly being relegated to highly competitive niches in mature technologies in external after-markets, making them vulnerable to exchange rates. BARNES J. and KAPLINSKY R. (2000) La mondialisation et la mort de l'entreprise locale?: les equipementiers en Afrique du Sud, Reg. Studies 34 , 797-812. Comme c'est le cas dans beaucoup des pays developpes, l'industrie en Afrique du Sud affronte un nouveau climat competitif au fur et a mesure du demantelement des barrieres tarifaires. Cela implique le besoin de prendre pied sur les marches exterieurs et de faire face aux nouveaux investisseurs etrangers qui arrivent sur le marche interieur. De plus en plus, repondre a ce nouveau climat international veut dire pour les equipementiers en Afrique du Sud l'integration croissante des filiales dans les activites strategiques internationales de leur maison-mere. Petit a petit, cela a entraine la recherche de fournisseurs etrangers pour se procurer des pieces detachees, en partie a cause des consequences illogiques et non voulus du Plan en faveur du developpement de l'indutrie automobile. La ou la production locale de pieces detachees est en jeu, il y a moins de possibilites pour les equipementiers autochtones et pas de possibilites presque pour les equipementiers qui se servent de la technologie locale. Par la suite, les equipementiers en Afrique du Sud se voient releguer de plus en plus aux creneaux tres competitives des technologies mures dans des marches secondaires externes, ce qui les rend vulnerables aux taux de change. BARNES J. und KAPLINSKY R. (2000) Globalisierung und das Ende der einheimischen Firma? Der Automobilkomponentensektor in Sudafrika, Reg. Studies 34 , 797-812. Wie viele Entwicklungslander, sieht sich auch Sudafrika bei der Aufhebungvon Handelsschranken einerneuen Wettbewerbslage gegenuber. Es ergibt sich sowohl die Notwendigkeit, in auswartige Markte einzusteigen, als es auch mit den neuen Einsteigern im einheimischen Market aufzunehmen. Im Falle der sudafrikanischen Automobilmontageindust...

PurposeThe purpose of this paper is to explore the dynamics of inter‐firm learning and the ways in which “learning networks” can be established and facilitated. Underlying this is the argument that significant traction on the problem of organizational learning – in this case around process innovations – can be gained through deploying structured and purposeful inter‐organizational learning networks.Design/methodology/approachThe paper builds on three case studies drawn from the experience of firms in South Africa, covering both vertical (supply chain) and horizontal (cross‐sector) groupings in automotive components and timber products.FindingsThe paper reports on the ways in which the learning networks were set‐up and operated, mapping this experience against a model framework which emphasizes a number of core operational processes. It suggests that the success of both the automotive component groupings and the failure of the timber products network can be explained through reference to this model and the different approaches taken to managing these core processes.Research limitations/implicationsThe research reported here draws on a small number of detailed cases and further work is needed to verify the model and the guidelines for action.Practical implicationsThe paper highlights guidelines for policy agents – for example, in business support agencies or regional development authorities – in setting up and running effective learning networks.Originality/valueThe paper contributes to theory around inter‐organizational networking and organizational learning and provides micro‐level detail of how learning networks can be established and sustained.

Mainstream economics and the Washington Consensus caution against industrial policies that target sectors, firms and regions. At the most they favour crosssectoral policies which address generalized market failures. This paper analyses the success of an industry-specific policy, South Africa's Motor Industry Development Programme. It documents significant learning processes and shows the impact of the sector's growth on macroeconomic performance. It also addresses the 'costs' of industrial policy and shows how well-designed scale-enhancing selective policies can provide domestic consumers with global-quality products at global-price levels, without subsidy from the exchequer. The conclusion addresses the relevance of such selective policies to other developing economies, arguing the case for intelligent and appropriately crafted industrial policy.