Abstract
Orientation: Cross-border trade (CBT) is an important economic activity that contributes to the development of many economies of the developing world.Research purpose: The two primary aims of the study were to find out the major factors needed to succeed in cross-border trading and whether the importance of these factors significantly decreased with export experience.Motivation for the study: The economic contribution of cross-border trade (CBT) is often understated. As a result, it does not get the attention it deserves.Research design, approach and method: Data were collected in Gauteng from 146 cross-border traders from 10 Southern African Development Community (SADC) countries. A cross-sectional research design was used.Main findings: The major key success factors were found to be skills/knowledge in; markets and supplies; financial management; and border issues. The importance of these factors was found to not significantly change with levels of export experience.Practical/managerial implications: Stakeholders should know that small firms of differing export experience require the same interventions to succeed. Interventions should empower traders to better access markets and supplies, improve their financial management skills and ease border constraints.Contribution/value-add: Few studies on cross border trading have been carried out in the Southern African Development Community region. The key success factors and the constraints in this type of trade had not been adequately explored. The economic contribution of CBT, which usually goes unnoticed, was highlighted. Interventions to appropriately address the challenges faced, such as trading legitimacy and border harassment, were suggested.
Highlights
Cross-border trade (CBT) is an important form of trade in many developing economies of the world
Though CBT in Central Europe decreased at the end of the 1990s when these countries joined the European Union, in South-Eastern Europe and Central Asian countries it is still a prominent pattern of entrepreneurship (Egbert 2006)
From the figures provided and from observations by (Unwomen.org), it can be concluded that CBT is an important economic activity contributing to the economic growth and government revenues of many economies
Summary
Cross-border trade (CBT) is an important form of trade in many developing economies of the world. Studies cover mainly formal small and medium-sized exporting firms, but not cross-border traders that are considered informal. This lack of interest is surprising given the importance of this trade in many economies. Chiwara and Ndiaye (2010) and Unwomen.org (2010) assert that it contributes 30% – 40% to intra-SADC trade. This is contradictory to what Bernard et al (2007:3) state, that ‘small firm exporting is relatively rare’. From the figures provided and from observations by (Unwomen.org), it can be concluded that CBT is an important economic activity contributing to the economic growth and government revenues of many economies
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