How has trade between South Africa and China evolved over the past decade?

Abstract

China is now South Africa’s significant trading partner, so it is important to examine how the resulting trade benefits compare with those from South Africa’s long standing traditional trading partners. South Africa’s trade with its long standing traditional partners and with China is examined by analysing the factor intensities of goods traded; trade intensity with each country; ease of market access of its products; and intra-industry trade opportunities. Results show that South Africa continues to benefit more from trade with its long standing trading partners than it does with China. Trade with China merely provides South Africa a market mainly for non-fuel primary commodities, while the traditional trading partners provide markets for both low value and high value added products and opportunities for intra-industry trade. This is essential for innovation and technology spillovers both of which are essential to help South Africa to develop its manufacturing base further.