South Africa’s longstanding partnership with China has reached a new milestone, with leaders from both nations committing to expand cooperation across key sectors during the South Africa-China Investment Forum held in Beijing this week.
Deputy President Paul Mashatile, recently addressing the forum during the China International Supply Chain Expo (CISCE), acknowledged the mutual benefits derived from increased trade and investment over the years. However, he emphasised the need for a more balanced relationship, as the trade deficit continues to favour China.
“South Africa’s trade imbalance with China is mostly attributable to the nature of our trading relationship. South Africa mainly exports raw materials and minerals while importing manufactured and capital goods,” Mashatile said.
He revealed that the trade gap has grown from under US$1 billion between 1988 and 2000 to a staggering US$9.71 billion in 2023. Since the launch of the Forum on China-Africa Cooperation (FOCAC), South Africa has experienced a cumulative cash outflow of US$114.83 billion to China.
The Deputy President called for “urgent, coordinated, and strategic” action to shift the dynamic. He advocated for greater access to Chinese markets, diversification of exports, and an emphasis on value-added trade to foster a mutually beneficial trade environment.
“We must look beyond raw materials. Expanding our export portfolio and promoting industrialisation through strategic partnerships is vital to South Africa’s economic growth, job creation, and long-term development,” he stressed.
Mashatile praised Chinese investments in South Africa, highlighting significant contributions in banking, renewable energy, telecommunications, and manufacturing. Notably, he cited the Industrial and Commercial Bank of China’s (ICBC) US$5.5 billion purchase of a 20% stake in Standard Bank as a landmark transaction that reflects deepening financial ties.
He also noted the long-standing presence of Hisense in the country, which entered the South African market in 1997 and later established a major industrial park in 2013. Other major Chinese firms, including Huawei and ZTE, continue to expand their footprint locally.
According to the Deputy President, 48 Chinese companies have invested more than US$11.69 billion in South Africa over the last decade. These investments span various strategic sectors and align with South Africa’s development goals.
Looking ahead, Mashatile highlighted key areas of interest for future collaboration: renewable energy, green hydrogen, infrastructure, logistics, digital economy, and the beneficiation of critical minerals. He also encouraged Chinese investors to explore opportunities within South Africa’s special economic zones and emerging sectors such as pharmaceuticals and medical devices.
“As South Africa-China relations continue to deepen, new opportunities are opening for Chinese businesses looking to expand into South Africa and the African continent,” he said.
Mashatile urged investors to take advantage of the African Continental Free Trade Area (AfCFTA), which offers a gateway to a broader African market and positions South Africa as a key trade and investment hub.
The Deputy President closed by reaffirming South Africa’s commitment to its strategic partnership with China, built on shared values and a vision of prosperity. Both countries continue to collaborate on global platforms such as the United Nations, G20, and BRICS to champion the interests of developing nations.
