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Johannesburg - Total trade between South Africa and Saudi Arabia has more than doubled from R29.7bn in 2009 to R80.1bn in 2013, said Minister of Trade and Industry Rob Davies.
He was speaking at the fifth session of the joint economic commission (JEC) between South Africa and Saudi Arabia, which was held on Thursday.
In January 2014 Saudi Arabia overtook Germany to become South Africa’s second largest source of imports, with China being the biggest.
Davies said the imbalance in SA's trade relations has added to a huge trade deficit which grew to R74.8bn in 2013 from R62.2bn in 2012.
He emphasised that SA is keen to step up efforts to reduce this huge trade imbalance, especially in value added exports.
“There is no doubt that the level of our bilateral trade, especially South Africa’s value added exports to Saudi Arabia, is far below potential," said Davies.
It is also concentrated in a few sectors like oil and gas, raw materials, fruits and vegetables.
Need to diversify
"This points to a need to diversify our basket of goods traded. More value added and diversified trade will benefit both our countries as it will lead to job creation, which is one of our biggest challenge at present,” said Davies.
“What ties our two economies, other than just historical ties, is our endowment of natural resources. Saudi Arabia has the biggest reserves of oil and remains the biggest oil supplier to the world over, including to South Africa."
In Turn South Africa is also very rich in mineral reserves.
"It is exactly against this mutual resource advantage that both our countries have taken a conscious decision to diversify our economies to various other sectors,” said Davies.
The JEC was preceded by the South Africa-Saudi Arabia Business Forum, which mandated the SA–Saudi Arabia Business Council to identify complementary projects they will collaborate on.
He was speaking at the fifth session of the joint economic commission (JEC) between South Africa and Saudi Arabia, which was held on Thursday.
In January 2014 Saudi Arabia overtook Germany to become South Africa’s second largest source of imports, with China being the biggest.
Davies said the imbalance in SA's trade relations has added to a huge trade deficit which grew to R74.8bn in 2013 from R62.2bn in 2012.
He emphasised that SA is keen to step up efforts to reduce this huge trade imbalance, especially in value added exports.
“There is no doubt that the level of our bilateral trade, especially South Africa’s value added exports to Saudi Arabia, is far below potential," said Davies.
It is also concentrated in a few sectors like oil and gas, raw materials, fruits and vegetables.
Need to diversify
"This points to a need to diversify our basket of goods traded. More value added and diversified trade will benefit both our countries as it will lead to job creation, which is one of our biggest challenge at present,” said Davies.
“What ties our two economies, other than just historical ties, is our endowment of natural resources. Saudi Arabia has the biggest reserves of oil and remains the biggest oil supplier to the world over, including to South Africa."
In Turn South Africa is also very rich in mineral reserves.
"It is exactly against this mutual resource advantage that both our countries have taken a conscious decision to diversify our economies to various other sectors,” said Davies.
The JEC was preceded by the South Africa-Saudi Arabia Business Forum, which mandated the SA–Saudi Arabia Business Council to identify complementary projects they will collaborate on.
