South African businesses could see a big increase in exports from May as African exports to China will become duty-free.
The policy, announced by Chinese President Xi Jinping, opens up access to a $3.5 trillion consumer market.
It comes as global trade faces uncertainty and rising tariffs elsewhere.
Opportunity for growth amid weak economy
HLB CBS Group CEO Henico Schalekamp said South Africa would benefit, especially given its slow economic growth.
“There's no doubt about it … it's a great opportunity for them to enter this market at no cost.”
He said businesses already doing business with China could expand further, while new exporters could also enter the market.
“With our low growth rates in the country currently, there is an opportunity for them to increase their revenues and profits.”
Major Sectors: Manufacturing and Specialized Exports
Schellekamp said the biggest gains are likely to be in areas where South Africa is competitive.
“It could be anything where we can be competitive… more manufacturing or engineering or a specialty product that we make.”
He said success will depend on how businesses establish themselves and build relationships in China.
“It depends on how smartly businesses operate… and the relationships in the right sectors in China.”
Possibility of investment from China
This change could lead to more Chinese investment in South Africa.
Schalekamp said Chinese companies could consider setting up local operations and boosting manufacturing capacity.
“They can bring some skills with respect to efficient manufacturing processes.”
He said partnerships between South African and Chinese businesses could strengthen local industry.
“I think they could be a huge benefit to our manufacturing industry.”
Global tensions create an opening
The move comes at a time when US tariffs have reshaped global trade flows.
Schallekamp said this has prompted countries to seek alternative markets and partnerships.
“He (Trump) basically forced all other countries to look at other opportunities.”
He said China could also redirect investment away from the US.
“I think it's becoming more and more difficult for them with America, so I think that's what led to this decision.”
Infrastructure challenges remain
Despite the opportunity, concerns remain about South Africa's preparedness to attract investment.
Benefits could be limited if issues involving Eskom and Transnet are not resolved.
“There's … very significant infrastructure that needs to be put in place.”
Schallekamp said that without reforms, the country may struggle to capitalize.
“The devil is in the details… otherwise the country is not going to get much benefit.”
Also read:
South Africa to sign 'duty-free' trade deal with China
China will allow duty-free imports of some South African products as Pretoria pushes to diversify export markets and boost growth.
SA signs historic deal with China to give exports duty-free access
The China-Africa Economic Partnership Agreement aims to expand trade and attract investment to South Africa.
Duty-free China deal will not crush South Africa's textile industry – Tau
The government says security measures are being taken as South African companies prepare to enter the Chinese market.
China removes tariffs for all African countries except Eswatini
Zero tariffs from May could be a “game changer” for African exports, experts say, but warn countries must act fast.
China's tariff-free access to African exports raises hopes and warnings
Analysts say the policy could boost jobs and industry, but warn that Africa risks exporting raw materials more than finished goods.
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