South Africa And China Trade Agreement

Rangasamy, L. Swanepoel, J.A. (2011). China`s impact on South African trade and inflation. Development Southern Africa, Vol. Pretoria, South Africa: Routledge. What distinguishes China is that, unlike the other four members, it is not the main member of a specific trading bloc per se, although it naturally has a number of important free trade agreements. The transfer of Hong Kong to the PRC in 1997 was a factor in the change in official recognition, as South Africa maintained strong commercial relations with the territory, then under British administration. Pretoria feared that after the handover, Beijing would degrade its consulate and that the country could no longer use Hong Kong as a transit route for air traffic and trade.

[12] In addition, prominent South African politicians and government officials in the post-apartheid government, particularly the Communist Party of South Africa, have strongly supported the transfer of recognition to the People`s Republic of China. [13] In 1992, trade between China and South Africa was $14 million, but when the two countries established relations in 1998, that figure increased to $1.4 billion. [5]182 Until 2010, trade between the two countries reached $25.6 billion, with imports from South Africa reaching $14.8 billion. In the same year, national investment increased to $7 billion. Most of South Africa`s exports to China in 2010 were primary products. [17] Two-way trade between China and South Africa reached $60.3 billion in 2014. [18] From 2000 to 2011, approximately 37 official development projects in China were identified in South Africa through various media reports. [26] These projects range from a $2.5 billion financial cooperation agreement between the Development Bank of South Africa and the China Development Bank[27] to an investment of $877 million per Jinchuan State Mine and China Development Bank in South Africa`s Platinum Industry[28] and a $250 million investment by China Huaqiang Holdings in a theme park in Johannesburg.

[29] One of the factors behind the increase in trade between China and South Africa is that the growth of the Chinese economy has led to an increase in demand for electricity, which has led China to increase its demand for cheap coal from South Africa. (You – Johnson-Reiser, 2012) In addition, China`s economic growth has also led to a growing demand for agricultural products from South Africa, which are needed to feed China`s growing population. In addition, China uses some of South Africa`s agro-African products in local industry. (Sandrey – Edinger, 2009) As a result, Chinese demand for South African agricultural products is expected to increase due to changes in Chinese GDP, which have had an impact on the consumption of Chinese agri-food products. (Edwards – Lawrence, 2012, 8) There are other aspects of free trade that need to be cleaned up. China grants tariff concessions to least developed countries (LDCs) under the WTO and grants duty-free access to 97% of tariffs on products exported to China, whether or not these countries have diplomatic relations with China. Among the SACU nations is Lesotho, in addition to 20 other African nations. China will therefore have to cooperate with both Lesotho and the WTO to promote a SACU free trade agreement that includes an LDC nation. Chinese President Xi Jinping has just returned from Brazil, where he attended the annual BRICS meeting in Brasilia.

At the meeting of the presidents and prime ministers of India, Russia and South Africa, the Brasilia summit statement said that the BRICS bloc had expressed common goals of “expanding trade and innovation”. Among these countries, Namibia and South Africa have signed the China Belt and Road Initiative, while China has also concluded double taxation agreements with Botswana and South Africa.