UK and South Africa look for 'next level' trade with state visit

Thu 24 Nov 2022
Posted by: Phillip Adnett
Trade News

UK South Africa flags - trade talks

South African president Cyril Ramaphosa has said British companies should use the “depth and experience of the South African economy” to “reinvigorate” trade between the two countries.

Speaking during a two-day state visit to the UK, which was the first hosted by HM King Charles, Ramaphosa said: “This state visit is an opportunity to reinvigorate the ties of commerce, trade and investment between our two nations.”

Speaking before MPs and peers, he said Britain was the largest foreign investor in South Africa and the country’s fifth largest export destination.

“British companies need to use this experience to greater effect to seek out opportunities in our country for investment and trade,” he added, pointing to opportunities in renewable energy, infrastructure and agriculture.

Green and sustainable trade

Prime minister Rishi Sunak held a working lunch meeting with Ramaphosa at Downing Street to discuss opportunities to boost trade exports with South Africa as they agreed the need to take their nations’ partnership “to the next level”.

No 10 said the pair used their meeting in Downing Street to discuss trade, with talks on “bolstering cooperation on green hydrogen and sustainable infrastructure” and “opportunities to increase exports and access for services”.

Sunak said: “South Africa and the UK are obviously very strong partners, allies, friends and we share so many of the same objectives – notably transitioning to clean energy while creating jobs and opportunity for our citizens.”

Cabinet ministers Grant Shapps, Kemi Badenoch and Steve Barclay also attended the lunch.

Health and climate deals

The visit was marked by the UK and South Africa signing an agreement to strengthen their health partnership to help prevent future pandemics, the Independent reports.

The two countries are also working together to tackle climate change, with the UK contributing funding to the Just Energy Transition Partnership with South Africa to help the country decarbonise its economy.

Ramaphosa’s visit coincided with the launch of the next phase of the UK-South Africa Infrastructure Partnership, supporting South Africa’s economic growth and UK export opportunities through major infrastructure developments worth up to £5.37bn over the next three years. 

Dynamic relationship

Trade secretary Kemi Badenoch said: “Today we’re moving into a new era of our dynamic trade relationship with South Africa, with exciting collaboration on infrastructure, clean technology, and renewable energy sources.”

Ramaphosa’s visit coincides with trade talks as the UK looks to boost its relations with its biggest African trading partner, reports Sky.

SA trade stats

South Africa is the UK’s largest market in Africa and the UK’s 27th largest trading partner, accounting for 0.7% of total UK trade.

Total trade in goods and services between the UK and South Africa was £10.7bn in the four quarters to the end of Q2 2022, an annual increase of 6.3% or £638m.

UK exports to South Africa were up 9.3% to £3.8bn in this period. UK imports from South Africa were £6.9bn, showing an increase of 4.7%.

The top five UK exports were: beverages, miscellaneous electrical goods, power generators, cars, and specialised machinery.

The top imports from South Africa were non-ferrous metals, fruit and vegetables, road vehicles, and metal ores and scrap.

African opportunity

The UK is keen to boost trade with fast-growth markets in Africa that present “boundless opportunities for African and UK businesses”, according to former minister for Africa Vicky Ford.

Earlier this year, UK Export Finance (UKEF) – the export credit agency of the British government – revealed it has more than tripled its investment in Africa to £2.3bn, reports Trade Finance Global.