While the world’s attention was focused on Donald Trump winning the US election, President Cyril Ramaphosa was meeting senior Chinese officials in Cape Town to cement and strengthen trade and political relations.
Ramaphosa and senior members of the ANC held closed-door meetings with members of the central committee of the Chinese Communist Party (CCP). In Joburg, the CCP met with ANC leaders, including secretary-general Fikile Mbalula and treasurer-general Gwen Ramokgopa. The CCP, the founding and still ruling political party of modern China, has maintained a political monopoly and has overseen the country’s rapid economic growth and rise as a global power.
Leading the Chinese delegation was Li Xi, who, according to the Brookings Institute, has close ties to Chinese President Xi Jinping. He is also the seventh-ranking member of the politburo standing committee of the CCP. Li was also recently in Kenya, meeting President William Ruto.
The discussions were about expanding investment opportunities, enhancing co-operation and increasing trade. The meetings underscore the close economic ties between the two nations and officials see the meetings as part of ensuring an increase in trade. Both countries are also members of Brics. China’s influence on Africa is growing.
China is South Africa’s largest trading partner, while South Africa is China’s No 1 trading partner in Africa. Total bilateral trade grew from R614bn in 2022 to R692bn in 2023, according to the presidency. Among the main exports from China to South Africa are electric batteries, while South African exports are mainly minerals, including gold and platinum. China’s investments in South Africa have been steadily increasing, particularly in infrastructure and manufacturing.
However, critics argue that the trade relationship is unbalanced, with South Africa primarily exporting raw materials and importing finished goods from China.
“The relationship continues to grow but we do have some trepidation,” a senior official who attended the meeting tells the FM. “Trade between us is unequal. China has opened up the market for us to have more access, but now it’s up to us to be a lot more aggressive. It’s not an absence of love from China, but rather South Africa has to seize opportunities to increase trade, and that means we need to produce more.”
Trade experts are concerned that the country’s close ties with China will be an issue for the incoming Trump administration. Could these ties lead to a withdrawal of preferential access to the US market for some African countries, including South Africa? The Africa Growth & Opportunity Act (Agoa) which provides for that access may be under threat.
Earlier this year, several US legislators called for a review of South Africa’s Agoa access, citing its close relationships with Russia and China. A cancellation could have significant economic implications for South Africa, as the country relies on Agoa for benefits from the export of certain agricultural products.
Speaking to the FM outside Tuynhuys after the China/South Africa meeting, presidency spokesperson Vincent Magwenya disagreed that this would be an issue. “We will, as South Africa, pursue an independent foreign policy and we will maintain our relations with our historic partners, including China, but also we will have to continue our relationship with the US and we should be allowed to and other countries should respect that.”
Prof Randall Carolissen, dean of the University of Johannesburg’s business school, tells the FM that Chinese trade with Africa has increased enormously over the years, while the US relationship has been lagging. “China’s trade with Africa is exceeding at least $250bn, whereas US trade in Africa is at just $50bn.”
Ramaphosa recently visited China and met Xi, and the countries elevated their bilateral relationship to a strategic co-operative partnership underpinned by strong political ties, balanced trade and transformative economic growth. Government insiders tell the FM that this has recently been elevated to a “special strategic relationship”.
We will continue to accrue benefits from having no enemies but sticking to our positions
— Vincent Magwenya
Carolissen says China has been much more active than the US in investing in major infrastructure projects across Africa, building ports, railways and road networks. “China has been involved in more than half of the infrastructure contracts on the continent, and those are the realities that the US will have to contend with.”
He also highlights that China’s investments in Africa have been met with criticism, particularly regarding debt sustainability and environmental impact.
With the world on edge regarding Trump’s protectionist policies, Magwenya says the government is not having sleepless nights over US-China disagreements.
“We’re not nervous about being forced to take a stance that will suit a particular global power or global agenda. We believe our stance is the correct one. We will continue to accrue benefits from having no enemies but sticking to our positions. And relations with Brics countries, including China and Russia, remain an important and strategic platform for us.” Magwenya says disagreements between China and the US should not be an issue for South Africa. “Spats among or between global powers are not for us to enter.”
Magwenya says they are not worried that a Trump presidency will have an impact on the Agoa renewal.
“The US recognises the strategic importance of South Africa on the continent, and therefore of maintaining a positive relationship. We have no reason to be worried or apprehensive because of a Trump win. If anything, it’s a relationship that we will be seeking to grow.”
The Biden administration has, however, already expelled countries including Uganda, Niger, the Central African Republic and Gabon from the trade pact for governance, security and human rights issues and there is concern that South Africa may be next.
South Africa is the US’s largest trading partner in Africa, with more than $20bn in two-way trade volume, according to US Census Bureau data from 2020.
Only a third of the country’s exports to the US benefit from Agoa. However, the major sectors that are benefiting from the trade deal include agriculture and the automotive sector. “Under a Trump administration, with its ‘America First’ mantra, trade policy would likely be insular and transactional,” notes Ronak Gopaldas, an economic policy expert at risk management consultancy Signal Risk.
The University of Pretoria’s Prof Chris Isike argues that it’s time for South Africa and the rest of the continent to stop accepting crumbs from the US. “Trump has viewed Africa with contempt and disregard. There is benign neglect and a paternalistic relationship with the continent. It will be difficult to say if Africa will benefit from a Trump presidency. Interesting times ahead, but as Africa, we have to stop reacting and rather the US must come to us as a mineral-rich continent.”
Carolissen says that whatever the fate of Agoa, the US will have to accept that China is making big inroads into Africa. He highlights the shifting dynamics in US-Africa trade relations, with China’s influence continuing to grow. “I fully suspect Agoa will be redrafted and will be relooked at to make it more strategic for the US and more for a lever to push in a particular direction.”
South Africa is confident that Agoa won’t be redrafted, and with the country taking over the G20 presidency from Brazil in 2025 and the US taking over from South Africa in 2026, Magwenya says Trump will probably be joining the other G20 leaders for the summit in Joburg next year.
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