This article is sponsored by Brand South Africa
Parks Tau took on the role of Trade, Industry and Competition Minister in mid-2024, following South Africa’s elections, as the country faces a multitude of challenges in navigating its intricate international relations and priorities.
Through the BRICS+ framework, South Africa seeks to bolster its trade and investment opportunities with both founding and new member states. For more than a decade, China has stood as South Africa’s largest trading partner, although this partnership has notable imbalances, particularly in the export of raw materials against the import of manufactured goods.
Tau has diligently worked to foster strong relations with the United States, underscoring the nation’s stance of non-alignment in the global political landscape. This initiative has gained momentum with the approaching renewal deadline of the African Growth and Opportunity Act (AGOA) in 2025.
Since its establishment in 2000, AGOA has permitted eligible sub-Saharan African countries to access the U.S. market without duties.
As the continent’s most diversified economy, South Africa stands as a principal beneficiary and is actively advocating for the renewal of this initiative while reinforcing connections with the new U.S. administration.
African agenda
The country is also committed to promoting its African agenda, with the effectiveness of the African Continental Free Trade Area (AfCFTA) at the core of its policy efforts.
Tau stated that South Africa intends to leverage its international partnerships, including its G20 chairmanship in 2025, to push for a favorable trade agenda not just for the Global South but particularly for Africa. South Africa is the sole African member of the G20, alongside the African Union, which has also secured a seat.
South Africa is balancing its international trade strategy with domestic export-driven initiatives. Actively engaging in the AfCFTA, the country aims to enhance trade under the agreement, especially given its position as Africa’s largest finished goods exporter.
Currently, approximately 25% of South Africa’s total exports are sent to other African countries, notably those in Southern Africa, which represent 90% of its exports.
In 2022, manufactured goods constituted 64.3% of South Africa’s exports to Africa, compared to 43.9% of its overall global exports.
South Africa began trading under the AfCFTA in January 2024 via the Guided Trade Initiative—a pilot project aimed at evaluating the operational, institutional, legal, and trade policy landscape as eligible countries start to engage more fully with the program.
High-growth sectors
Tau asserts that industrial policy is central to South Africa’s economic growth strategy, with a shift in focus toward high-growth sectors promising substantial returns: “these encompass the green economy, smart agriculture and agro-processing, automotives, iron and steel, organic chemicals, and the digital economy,” he notes. The policy will also prioritize local content to cultivate skills and stimulate demand for specific manufactured products.
The government is partnering with the private sector to address significant infrastructure and logistical obstacles as it aims to enhance export capabilities.
