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Trade Agreements Between South Africa And China

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The interesting thing about the statistics is that trade flows are relatively reciprocal — Africa sells to China a little less than what China sells to Africa. In 2017, Angola was the largest exporter to China, followed by South Africa and the Republic of Congo. In contrast, South Africa was the largest buyer of Chinese products, followed by Nigeria and Egypt. As you can see, China has put in place diplomatic and tax incentives to encourage African companies to trade with China, which remains a market that wants to consume. African products are welcome in China and there is huge growth potential. Nevertheless, these are diplomatic issues and not more problematic issues that need to be resolved. China certainly has Africa in mind and, at present, SACU remains the most viable and organized free trade bloc in Africa with which it can work. Sacu works very well in facilitating inter-regional trade and the movement of goods between the five countries of this subcontinent. Cross-border exchanges take place with minimal handicap, bureaucracy or red tape. Among these countries, Namibia and South Africa have signed the China Belt and Road Initiative, while China has also concluded double taxation agreements with Botswana and South Africa. South Africa is also a member of the BRICS group of countries. Since 2007, political relations between the South African and Chinese powers have been closer. In this series of articles, I will explore each of the possible scenarios that could occur during the development of free trade within the BRICS.

In this article, I discussed the potential for China`s engagement in the Southern African Customs Union (SACU). In 2010, China was South Africa`s largest trading partner. [1] Since 2007, China-South African relations have strengthened as trade and political relations have intensified. [2] [3] In the 2010 Beijing Declaration, South Africa was revalued by the Chinese government as a global strategic partner. [4] Prior to the fall of apartheid in South Africa, relations between the two countries were officially non-existent and unofficially antagonistic. These are quantifiable points, although partly dependent on the political landscape. It will take time. In the long term, and given the huge network of Free Trade Areas and the Chinese economy that are forming along the Belt and Road initiative, including across Africa, further study is warranted.

In addition, it should be noted that there is an ASEAN influence in the mix. The ASEAN bloc – Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam – is quite close. From Durban, South Africa`s largest port to Singapore, the logistics zone takes 14 days or a 13-hour flight. China has a free trade agreement with ASEAN, which means SACU companies can use it.