Beijing: South Africa and China are set to expand their partnerships across multiple sectors as Deputy President Paul Mashatile addresses the persistent trade imbalance between the two nations.

According to South African Government News Agency, Deputy President Mashatile highlighted at the South Africa-China Investment Forum, held during the China International Supply Chain Expo (CISCE) visit to Beijing, that while trade and investment have mutually benefited both countries, there remains a significant trade deficit favoring China. He noted that South Africa primarily exports raw materials and minerals while importing manufactured goods and capital goods from China, which has contributed to the trade imbalance. This deficit has grown from under US$1 billion between 1988 and 2000 to US$9.71 billion by 2023, resulting in an accumulated cash outflow of US$114.83 billion from South Africa to China since the inception of the Forum on China-Africa Cooperation (FOCAC).

Deputy President Mashatile called for urgent action to address these challenges, emphasizing the need for a strategic approach to develop a more balanced trade relationship. He advocated for expanding South Africa’s export portfolio, encouraging value-added exports, and creating partnerships that can foster economic growth, job creation, and overall development. Chinese investments in sectors such as banking, manufacturing, and renewable energy have already made significant contributions to South Africa’s economy.

The Deputy President acknowledged the success of President Cyril Ramaphosa’s investment mobilisation drive, which has led to increased Chinese investment in South Africa. A notable investment is the Industrial and Commercial Bank of China’s (ICBC) purchase of a 20% stake in Standard Bank for US$5.5 billion. He also mentioned the entry of Chinese electronics manufacturer Hisense into the South African market in 1997 and the establishment of an industrial park in 2013, along with the expanding presence of companies like Zhong Xing Communications (ZTE) and Huawei Technologies.

Over the past decade, 48 Chinese companies have invested in South Africa, with a capital investment of over US$11.69 billion. As bilateral relations deepen, new opportunities are emerging for Chinese businesses, particularly in sectors such as renewable energy, green hydrogen, and infrastructure. Deputy President Mashatile urged investors to capitalize on the African Continental Free Trade Area, which offers access to the African market for companies in various sectors, including pharmaceuticals and infrastructure.

Both nations are engaged in multilateral institutions like the United Nations, the Group of 20, and BRICS, where they collaborate on global issues and advocate for the interests of developing countries. The Deputy President affirmed South Africa’s commitment to building on the economic relations established since diplomatic ties were formed in 1998, valuing the longstanding relationship based on a shared vision for a prosperous future.