Fin24

Zuma seeks to narrow China trade gap

2010-08-24 11:18

Beijing - President Jacob Zuma is looking to narrow South Africa's trade deficit with China, as the government seeks to broaden South Africa's economic appeal beyond mines and resources.

China is South Africa's largest trading partner, but last year South Africa ran a $2.7bn trade deficit with China, according to South African statistics.

"We all agree that in South Africa's export market to China there is a preponderance of primary products, and in our imports from China there is a preponderance of value-added goods," South African Trade Minister Rob Davies told a news briefing on Tuesday, the first full day of a three-day visit to China.

"We want to work together with China to try to address that so we have a more equitable balance of trade," he said, urging manufacturers of power equipment, railway cars, solar water heaters and vehicles to consider setting up factories in South Africa.

In the first six months of 2010, trade between the two countries reached $10.8bn in value, a 56.1% jump compared to the same time last year.

South Africa is looking for expanded trade and investment to help meet its development needs by improving roads, communication and power and by generating more manufacturing jobs, Zuma told a forum of business executives from China and South Africa.

"China is indeed a key strategic partner for South Africa, and South Africa is open for business in a big way," he said.

"We envisage meaningful future cooperation in infrastructure, the benefaction of minerals, engineering, energy, information and communications technology and electronics. There are also opportunities to be explored in manufacturing."

Zuma's comments underscored the attractiveness of China for African countries, while also hinting at the frustrations of African governments and companies that want to see more Chinese investment and orders spreading beyond mines and resources.

For Beijing, Zuma's visit is an opportunity to consolidate ties with African countries, where China is increasingly turning for resources, markets and diplomatic support. Late last year, Chinese Premier Wen Jiabao offered Africa $10bn in concessional loans over three years.

Zuma was accompanied by a delegation of over 370 business representatives - the biggest ever for a South African leader's visit abroad, said officials.

Chinese and South African executives signed a dozen deals and memorandums of understanding about investments in energy, power transmission and railways.

The deals included a $303.6m loan agreement between South Africa's third-largest mobile phone operator, Cell C, and China Development Bank.

Comments
  • DeonL - 2010-08-24 11:49

    What is his fiance doing there with Zuma, I thought this is a business trip?

  • Juan - 2010-08-24 11:51

    Zuma can't even point out china on a world map, so he really shouldn't comment. I wonder how much this luxury trip of his cost the taxpayer this time.

  • D - 2010-08-24 11:53

    China will move in a take over, in a sense. This is one of many ways communism works. There are loans being given to SA, and SA businesses left, right and center from China. What do you think will happen when China calls in those loans. It will cripple SA and then China will move in for the kill. At this present moment, SA has a heck of a lot of what China needs and/or wants. I sincerely think there is a plan, behind their so called plan in their partnership with SA.

  • BB - 2010-08-24 11:54

    Could he not have postponed his trip and spent his time better here? What message does it send to the world when the president goes overseas in the middle of a major nation-wide strike. He should be here working in the hospitals and schools.

  • Frank - 2010-08-24 11:59

    Slowly but surely China is buying up Africa for China's own benefit...

  • Juan @ BB - 2010-08-24 12:33

    Why should zuma worry. He hets private medical treatment and his kids are all in private schools. The strikes don't affect him, thus he doesn't care. He is guarenteed a win in the next election as he will be doing a song and dance in exchange for a vote.

  • tseliso - 2010-08-24 12:38

    Very sad that we made China $2.7bn richer last year. Where we looking? What does the Unions have to say about this?

  • YasButIDunno - 2010-08-24 12:46

    What planet is Rob Davies on? "South Africa is open for business in a big way"??? Buddy your public service colleagues are on their annual nationwide strike - or did this fact escape you as you blue-lighted your way to the airport? No sane Chinese businessman will open a factory in this country - unless they bring all their own labour with them from China as happened in Swaziland. Speaking of Swaziland - I hear a rumour that HRH Zuma has yet another "fiancee" lined up there... Bwahahahahaha!

  • @home - 2010-08-24 12:46

    I think the only thing that Zuma "seeks" is another way to waste tax money. I believe he feels "@ home" there between all the communists.

  • Ryan - 2010-08-24 12:47

    This is just a symptom of years and years' snubbery to do business with Africa by the big economies of the world. Would all you whiners have felt better if it was the USA or the Europe Union? One needs to distinguish between China's government that is central and Communist and very successful in governing China and its economic policies that are very capitalist in every way. I think this is a great opportunity for Africa to get a big slice of the world economic action! Another benefit would be the very positive work ethic of the Chinese. I am sure Africa can benefit therefrom.

  • Mndlos - 2010-08-24 12:49

    For how long are you guys going to be so nagetive about Our don't you get tired of this? remeber being negative kills your own life not ours!

  • Shrek - 2010-08-24 13:17

    With all the strike action in SA, the Chinese are not interested in investing in SA. If they did invest, they would expect the same work ethic as they have in China, and guess what......thats never going to happen.

  • @ tseliso - 2010-08-24 13:20

    With all the strike action, this deficit with China and Europe/America will grow 'cos these countries are not interested in investing in SA. Remember, SA needs the products/services from those countries more than those countries need SA.

  • 50 CALIBER - 2010-08-24 13:37

    I sent this comment in a few hours ago and guess what. Our dear anc moderators didn't display it. I WANT TO KNOW WHO IS PAYING FOR 370 ANC BUSINESS REPRESENTATIVES to fly all the way to China. That's two jumbo jets required. Not to forget the presidential jet with zuma and all his commie cronies. WHO THE HECK IS PAYING???

  • Peter - 2010-08-24 13:40

    Can't you see Chinas largest export to SA are its masses of people that every day arrive on Cathy Pacific from Hong Kong. Ever been on one of these flights ? there you see people who can not even read or write going to SA every single day one plane load full. Given time my dear countrymen we are going to be replaced by them.Do not think for a moment that these are people of the old Chinese traditions these have no honour nor feelings for animals or nature preservation and the like. They have one thing in mind and one thing only and that is to make as much money as possible as quick as possible disregarding any damage they may do. Corruption , bribery , raping nature these are considered normal in China. I do know what I am talking about having been involved and having travelled to many places in China since 1987. So how are we going to address that trade deficit? Easy to get to SA just register in a so called " language school " and Bob's your Uncle " you get your visa from then on just work for a little shop and soon you will have your Permanent Residence Visa. Try doing that in China ...Impossible.

  • Fair Deal - 2010-08-24 15:42

    Hello China produces most of the worlds finished goods . China is the factory of the world because they have skilled labour at economical prices. No one can compete with China that is why they all use China as their factory. The only opporunity that exists for us is the export of raw materials.

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