Nigeria and South Africa are committed to working together to build Africa’s industrial base and will play a valuable role in ensuring value is added to the continent’s natural resources. South Africa’s Trade and Industry Minister Rob Davies was confident in this assertion made at a business forum in 2013 during the state visit of President Goodluck Jonathan to his southern counterpart.

Davies, at the same function, announced that Africa’s two biggest economies were in the process of negotiating an automotive sector agreement that would see South Africa providing technical support and information to assist Nigeria in its goal of making the automotive sector a key underpinning of a new industrial future.

The collaboration between the countries signals a new approach to economic co-operation that may help to offset concerns about the fact that the bilateral trade basket is effectively weighted in South Africa’s favour. Although Nigeria’s exports to Pretoria are much higher than its imports from there, this trade is made up almost entirely of one commodity - crude oil - while South Africa’s is highly diversified.

The trade situation is partly a consequence of the economic evolution of the two countries.

This policy brief forms part of a South African Foreign Policy Initiative (SAFPI) series, all written by Dianna Games, Chief Executive of African business consulting company Africa @ Work and Honorary CEO of the Johannesburg-based South Africa–Nigeria Chamber of Commerce, which examines key issues in South Africa and Nigeria's bilateral relationship.