Evaluation of the Effect of Adopting Genetically Modified Cotton and its Impact on Tax Transformation and Employment in the Cotton Value Chain (A Case Study of the Kingdom of Eswatini)
| International Journal of Economics and Management Studies |
| © 2023 by SSRG - IJEMS Journal |
| Volume 10 Issue 3 |
| Year of Publication : 2023 |
| Authors : Daniel Khumalo, Collin Kamalizeni, Narayanasamy Shanthi |
10.14445/23939125/IJEMS-V10I3P103
How to Cite?
Daniel Khumalo, Collin Kamalizeni, Narayanasamy Shanthi, "Evaluation of the Effect of Adopting Genetically Modified Cotton and its Impact on Tax Transformation and Employment in the Cotton Value Chain (A Case Study of the Kingdom of Eswatini)," SSRG International Journal of Economics and Management Studies, vol. 10, no. 3, pp. 16-21, 2023. Crossref, https://doi.org/10.14445/23939125/IJEMS-V10I3P103
Abstract:
Cotton plays a major role in the economy of Eswatini, employing over 10% of the country's population and contributing 2.1% of the country's Gross Domestic Product (GDP). It is an important cash crop and source of livelihood for Swazis living in drought-prone areas. Farmers grow cotton under rain-fed conditions resulting in a serious yield decline due to climate. Production of cotton under rain-fed conditions has negatively impacted cotton yield. Yield losses adversely affected the cotton supply chain, yet the industry is a major contributor to the country's employment. The industry faces challenges due to the current predicament, culminating in the country's largest cotton ginnery operating at 10 per cent, and spinners are currently non-functional, reducing employment opportunities. Finally, the textile industry imports cotton yarn from China, India, and Taiwan. The Kingdom of Eswatini recently adopted genetically modified cotton under irrigation to increase the cotton supply in the cotton value chain. This strategy is a viable alternative for Eswatini to sustain the country's economy through cotton production. The study evaluates the effect of adopting genetically modified cotton and its effects on tax transformation and employment in the cotton value chain, with the view to creating the needed employment and creating the tax base for the country. The study design was exploratory to investigate the potential to create employment and transformation of tax. Senior managers in the cotton value chain were deemed key informants due to their knowledge and understanding of the current dynamics in Eswatini's cotton industry. The study revealed that adopting genetically modified cotton would increase cotton yield due to a guarantee of moisture availability during production. The study indicates an increased supply of cotton in the value chain, influencing employment numbers in cotton ginning, spinning, weaving and textile. The finding further reveals an increase in tax contribution from corporate tax and employment tax throughout the cotton value chain. Finally, the study recommends the development of strong policies to encourage cotton processing with the kingdom to eliminate the export of raw cotton
Keywords:
Genetically modified cotton, Technology adoption, Employment creation, Cotton value chain, Tax transformation.
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