South Africa’s Trade partners, imports and exports

South Africa’s most prominent trading partner, the United Kingdom, provides 41% of all imports and consumes 33% of all exports and is a powerful link for a variety of reasons. First of all, both use English as their business language, making communications regarding trade policy and other factors facile. But, since both policies are very similar, trading is in great agreement, nonetheless. They both share a strong, growing economy with a very powerful infrastructure, and act as powerful points toward further growth, for one another. Considered a great advantage on both counts, a lot of their products are duty free and their policies agree to strive for a tariff free trade over the course of the next decade or so. Some interests are similar and do go both ways. Both countries are striving toward privatization and restructuring of telecommunications, healthcare, and agriculture, during which they are able to assist one another via trade. The UK-SA Partnership Programme entails that both countries may provide free support in helping their businesses with their long-term investments.

At a close second, the United States is a recipient of about 20% of South Africa’s exports and South Africa receives about 11.4% of their imports from the United States. The obvious reason as to why these two countries are big trade partners is due to their economic status. Much like the UK and SA, the US and SA have powerful, constantly growing economies. The United States imports a large quantity of natural resources, in the likes of gold and diamond, two gems very useful to the United States. The United States is able to provide South Africa with different types of scientific equipment and chemicals. The products both countries receive from one another would not be very cheap at all if they were to produce these things individually, without the help of one another. Gold can be mined in the United States, but the cost of setting up mines and actually finding those areas possibly rich in gold would be costly and very inefficient. On the other hand, the United States is very technologically advanced and can provide South Africa with chemicals and scientific instruments that would cost them a fortune to produce individually. This is very much on a quid pro quo basis.

South Africa’s export commodities include much of what it cultivates and/or mines. That is, most of their metals are exports, whether they are in a raw form or in the form of jewelry or machinery. Those include gold, diamonds and platinum. Many of their minerals are needed as well and are also sent out as exports. Because the products that South Africa produces are very rare to so many countries, including the UK and the US, its products make up a large part of their exports. Being able to produce these things cheaply induces demand by foreign countries. And, since South Africa is duty free with many large trade partners, even with other costs like shipping, South Africa’s products are very worthwhile. However, South Africa’s agricultural products are not in high demand, other than sugarcane. What it grows may be rare to many countries, but exporting these products would be of more cost to those countries demanding them, than it would cost to use the rare quantities they domestically possess. Neighboring countries like Zimbabwe are exceptions.

Alternatively, South Africa’s imports are much more technology-based. As mentioned, it receives products such as scientific instruments and chemicals from the United States. This is mainly due, not to the fact that they are in any way incompetent of deriving these things themselves, but due to the fact that research in these areas is still under-funded and in progress. It turns out to be more lucrative to import these items. From its Middle Eastern partners South Africa obtains many of its petroleum products. Petroleum is actually quite rare to the country’s landscape and is therefore necessary to be a trade product. From some of its immediate neighboring countries South Africa imports food products, fruits, wheat, and other basic items. Cheaper labor makes it economical to trade, since of course, South Africa has a much better and required wage for workers of all sorts.