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South Africa and China a match made in heaven

January 27, 2011

Trade between China and South Africa is gaining momentum and for those companies who may have ignored this growing trade relationship in the past, are now forced to recognize the potential for doing business with China.
According to The China Inc meets SA Inc Business Forum, not only is there room for growth in trade between South Africa and China, but China is viewing the well-developed infrastructure South Africa provides as the key to unlocking the gateway into the rest of Africa.
In 2009, China surpassed the United States, to become South Africa’s largest export destination, whith trade between China and South Africa reached USD 16 billion in 2009.
With the signing of various cooperation deals in August 2010, by President Zuma during his State visit to China, this figure is expected to grow as China looks to export raw materials to fuel its booming economy.
The recent deals signed by Zuma focus on the mineral resources sector, railway development, construction industry as well as the mining sector and finally power transmission and nuclear power.
So for South Africa, doing business with China is good business my china. Far better than doing business with the US and Europe who are only looking for new markets for their goods without offering the same for our goods. This attitude by the developed world, the US in particular, is the reason the Doha negotiations are still deadlocked since 2001.
Its objective is to lower trade barriers around the world, which allows countries to increase trade globally. Talks have stalled over a divide on major issues, such as agriculture, industrial tariffs and non-tariff barriers, services, and trade remedies. The most significant differences are between developed nations led by the European Union (EU), the United States (USA), and Japan and the major developing countries led and represented mainly by Brazil, China, India, South Korea, and South Africa. There is also considerable contention against and between the EU and the USA over their maintenance of agricultural subsidies—seen to operate effectively as trade barriers.
To think that it was the US that first proposed the removal of agricultural subsidies in the first place. Developing countries were first to foolishly remove the subsidies to their detriment.
So more trade between developing countries make better sense as they trade on an equal footing and there is very little chance of blackmail or brinksmanship.

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