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SA-China trade rebalancing to feature during Zuma's visit next week

19th August 2010

By: Terence Creamer
Creamer Media Editor

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South African President Jacob Zuma will lead a State visit to China next week in a bid to strengthen political, economic and trade relations with the world's second-largest economy and South Africa's largest trading partner.

 

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In 2009, China eclipsed the US as South Africa's largest export destination, while South Africa imports more from China than any other country.

 

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Total trade between the two countries stood at R119,7-billion in 2009, which is significant given that the two countries only established full diplomatic relations in 1998.

 

China's imports from South Africa are resources heavy, while it exports a wide range of manufactured goods, from electrical machinery and electronic equipment, to appliances, computers and printing equipment.

 

During the visit, which begins on August 23 and ends on August 26, Zuma and China's Premier Wen Jiabao would also sign a ‘Comprehensive Strategic Partnership Agreement', which is described as the first such agreement concluded by China with any other country.

 

Frontier Advisory CEO Dr Martyn Davies, who is also a China specialist, tells Polity that the Zuma visit is part of the South African government’s political and economic strategy to align itself with the so-called “rising emerging markets”.

 

In the last quarter alone, Zuma has had interactions with the Head of States of each one of the so-called Bric economies, comprising Brazil, Russia, India, and China.

 

Davies, who will participate in the visit, said that the partnership agreement could also be seen as part of efforts to foster mutually supportive positions for South Africa and China in the evolving emerging-market arena. For instance, it could lead to China supporting South Africa’s participation in future Bric summits, should these emerge, and to South Africa reciprocating by encouraging the inclusion of China into the Ibsa bloc of India, Brazil and South Africa.

 

During the State visit, a business seminar, involving more than 200 South African business leaders and entrepreneurs would also be held in Beijing, and business contracts between South African and Chinese companies will be signed.

 

However, Davies tells Polity that most of the commercial transactions will be either ceremonial, or relatively modest.

 

Some believe this to be a direct result of the current misalignment between South African business and government in the way that commercial relations are being pursued with countries such as China. There also appears to be a lack of coordination and long-term strategic planning around State visits, which is leading to the relegation of commercial interests in favour of political outcomes.

 

Government-to-government agreements would also be concluded in the areas of geology and mineral resources, environment management, transport and railways.

 

Government spokesperson Themba Maseko said on Thursday that the partnership agreement would seek to deal with the current trade imbalances between the two countries, particularly the fact that South Africa still exports raw materials to China and imports finished products in return.

 

The Department of International Relations and Cooperation reports that South Africa intends hosting the fourth South Africa-China Bi-National Commission later in 2010, which would be led by South Africa's Deputy President Kgalema Motlanthe and China's Vice-President Xi Jinping.

 

During the August visit, Zuma will accompanied by International Relations and Cooperation Minister Maite Nkoana-Mashabane, Home Affairs Minister Dr NkosazanaDlamini-Zuma, Minister in the Presidency Collins Chabane, Trade and Industry Minister Dr Rob Davies, Minister of Economic Development Ebrahim Patel, Transport Minister Sibusiso Ndebele, Energy Minister Dipuo Peters, Mineral Resources Minister Susan Shabangu, Water and Environmental Affairs Minister Buyelwa Sonjica, Higher Education and Training Minister Dr Blade Nzimande, Tourism Minister Marthinus Schalkwyk, and Agriculture, Fisheries and Forestry Minister Tina Joemat-Pettersson.

 

 

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