Fruits of Engagement
The avocado export agreement between South Africa and China is crucial for job creation and poverty alleviation
On the eve of the 15th BRICS Summit in Johannesburg in August, Chinese President Xi Jinping met his South African counterpart, President Cyril Ramaphosa. After the pomp and ceremony at the Union Buildings in Pretoria, the two leaders and their ministers announced a raft of bilateral agreements across many fields.
One of the agreements, signed by South African Minister of Agriculture, Land Reform and Rural Development Thoko Didiza and Chinese Minister of Foreign Affairs Wang Yi, allowed South African farmers to export avocados to the Chinese market.
It’s an important development for South African farmers. It grants them access to an important market, which can create more jobs locally and boost economic growth. Moreover, it allows the country to promote export-driven growth in Sub-Saharan Africa. This is crucial for the Africa’s most industrialised economy, for which agricultural export is key.
A timely deal
You may ask yourself whether this is anything to shout about. It is. In a country suffering from rampant poverty, massive unemployment and inequality, the agreement could not have come at a better time. It means more jobs and poverty reduction. So, local farmers have a reason to smile because the deal means more opportunities for them, and fewer barriers related to international trade and export.
Notably, and quite importantly, it underscores the growing economic and political relationship between South Africa and China. The fact that it was President Xi’s sixth visit to South Africa says a lot. The symbolism and significance of the visit and bilateral agreements signed can only be ignored by people who are in a denial about the rise of the BRICS group and the closeness of Chinese and South African peoples.
Xi could have chosen any other country to do business with. But he chose South Africa. Ramaphosa could have allowed Western pressure to reduce economic ties between South Africa and China. But he didn’t.
Importantly, the agreement also goes a long way in addressing trade imbalances between the two partner nations. South Africa primarily exports minerals and mineral products to China, including iron ore, platinum, manganese, and coal. In return, South Africa imports a wide range of goods from China, including machinery, electronics and manufactured goods.
China has also made significant investments in South Africa, particularly in sectors such as infrastructure, mining and manufacturing. Chinese companies have been involved in various infrastructure projects in South Africa, including the development of ports, railways and energy infrastructure. It shows that both countries are working to diversify their trade relationship beyond the traditional focus on raw materials.
And this has not gone unnoticed by South Africans. They have grown closer and closer to Chinese people at a personal level. Personal relations and social interactions between locals and Chinese nationals seem to be growing.
Growing interest
If you visit Chinese-owned businesses in South Africa, especially in the retail sector, chances are high that you will find many locals employed alongside Chinese nationals. Unlike in the past, it’s no longer rare to hear South Africans expressing the desire to learn Mandarin. It is becoming a language of choice for many who see China as the future on the economic front, and those who have already adopted a “look East” policy.
In my other role, as a businessman, I interact with many South African entrepreneurs. Recently, I have fielded calls about the China-South Africa Trade Fair in Johannesburg on 20-22 September. Those who are aware of my relationship with Chinese people have asked how they could be part of the trade fair, and forge closer ties with their Chinese counterparts.
If anything, the avocado export agreement underscores the importance of economic and political ties for locals from all walks of life in both countries.
Notably, the agricultural sector, and the avocado farmers in particular, would never be the same again. For ordinary South Africans, just like their Chinese counterparts, this agreement can help to lift them out of poverty.
China has also made significant investments in South Africa, particularly in sectors such as infrastructure, mining and manufacturing.