By China and South Africa have reached an agreement to promote balanced trade and explore avenues for increasing two-way investments between their industrial and commercial sectors. This landmark agreement was announced in a joint statement released on Tuesday, following a high-stakes meeting between Chinese President Xi Jinping and his South African counterpart, Cyril Ramaphosa, in Beijing.
The meeting, which took place on Monday on the eve of the ninth forum on China-Africa cooperation, was hailed by both sides as being of “great significance” to the development of bilateral relations. It underscored the growing importance of the economic partnership between China, the world’s second-largest economy, and South Africa, a key player in the African continent.
At the heart of the discussions was the pressing issue of addressing the trade imbalance between the two nations. South Africa, for whom China represents the largest global trading partner, has been grappling with a significant trade deficit. In the past year, the value of South African imports from China substantially exceeded its exports to the Asian giant. President Ramaphosa arrived in Beijing with a clear agenda: to narrow this gap and advocate for a review of South Africa’s trade structure with China, emphasizing the need for more sustainable manufacturing and job-creating investments.
Responding to these concerns, China expressed a willingness to support job creation in South Africa. The joint statement outlined plans for recruitment conferences aimed at Chinese enterprises to promote local employment in South Africa. Both countries also agreed to explore the establishment of manufacturing bases near relevant raw material sources and to promote technology and skills transfer among their businesses.
The scope of the agreement extended beyond trade balance and job creation. China offered to share more of its experience in poverty reduction and rural revitalization with South Africa, highlighting the multifaceted nature of their cooperation. Both countries signed numerous cooperation documents covering various sectors, including the application of a satellite navigation system, housing and settlement, and export requirements for dairy products and raw wool from South Africa to China.
In the crucial area of energy, both nations expressed interest in expanding cooperation in renewable energy, energy storage, transmission, and distribution. They announced plans to co-host a new energy investment conference to be organized by their respective chambers of commerce and associations, signaling a commitment to sustainable development and green technology.
The leaders also used this platform to make a joint call to the international community, urging support for African countries in implementing the African Continental Free Trade Agreement. This ambitious project aims to create the world’s largest free trade area for goods and services, potentially transforming the economic landscape of the entire continent.
While the joint statement was comprehensive in outlining areas of cooperation, it notably did not include any specific fresh investment or financing pledges. This stands in contrast to the leaders’ meeting in Johannesburg last August, where Chinese power companies made concrete commitments to several projects in South Africa. These included upgrading nuclear power plants, extending the life of coal-fired power stations, and setting up manufacturing facilities for transformers and solar PV panels.
The Beijing meeting builds on the foundation laid during last year’s BRICS summit, where Ramaphosa announced that China had extended a grant worth 500 million rand for South Africa’s power sector, although specific timelines were not provided at that time.
This latest agreement between China and South Africa represents a continuation of their efforts to strengthen economic ties and address trade imbalances. It reflects China’s growing influence in Africa and its strategic interest in deepening relationships with key African nations. For South Africa, the agreement offers potential opportunities for economic growth, job creation, and technological advancement.
Reuters
