Win-win for China-sa co-operation

CHINA leads South Africa in many respects: size of population, country and economy. It has the world’s secondbiggest economy, but the journey to prosperity was not an overnight occurrence. In the late seventies the Chinese had one of the worstperforming economies, with tens of millions facing starvation, and had closed the door to investment.

Change began in the late seventies when reformist Deng Xiaoping came to power. He first dealt with the agricultural sector. Food supplies and production were alarmingly low. Families were given land to farm and the state took part of their produce.

They welcomed investment, eased trade policy and looked at new enterprises to deliver opportunities. As they opened up, capital, human resources and technology flowed in, enabling the Chinese to re-industrialise and emerge with a giant economy.

It’s a lesson for us. South Africa is much smaller, but faces similar challenges. We can learn from China’s experience, including weighing the cost of development against that of the environment, for example.

We are at a development crossroads with unemployment, a lack of skills, race-based inequality and an economy only slowly ticking over.

The government has developed a number of policies, including the Industrial Policy Action Plan, to deal with economic and industrial growth challenges and race-based poverty, inequality and unemployment.

To achieve our goals, it has signed trade exchanges and partnerships. One of our great strategic partnerships is the Brazil, Russia, India, China and SA alliance (Brics).

Brics is more than a trade platform; it’s where countries learn from each other, cultural exchanges take place, and a myriad beneficial relationships can be developed.

Last year intra-brics exports were about R4trillion. China accounted for 40%, India 27%, Russia 16%, Brazil 10% and SA 7%.

Member nations have different ideologies and policies, but what is important is that we seek common ground. We should ensure the relationships are genuinely inclusive and equally beneficial.

China is SA’S biggest trading partner. We established diplomatic ties in 1998, but even before then the Anc-in-exile engaged China for support and counsel.

Notable moments include Oliver Tambo seeking support and counsel from China from the sixties through to the mid-eighties.

Clearly, the basis for our brotherhood stretches far back. Earlier this year, China and SA established a people-to-people exchange mechanism. It encourages exchanges involving culture, education, communication, health, science, technology, sport, tourism, women and youth.

As part of this, Chinese and African media houses have cooperated more on information sharing, best practice and training.

Speaking at the launch of the mechanism, at a dialogue with the Department of International Relations and Co-operation this year, China’s Vice-premier Liu Yandong pointed out the countries shared the ideal of co-existence, equality and responsibility.

Such programmes are meant to find common ground, improve our understanding and enable us to work together to tackle challenges.

SA imports more from China than China does from us. Our exports to China include iron ore, steel, manganese, chrome, tobacco, wool, granite, gold, copper, aluminium and vehicle spares.

We do export manufactured goods, but there is room to grow: agro-processing, chemical, ICT and electronic companies are well-placed to export their goods and services.

There’s room for a more balanced trade relationship and it should be explored within the Brics framework.

Our financial relationship is not just about imports and exports. Much entails foreign direct investment – both ways.

Earlier this month, China’s State Council announced measures for increased foreign investment. They will also make this environment more law-based, international and convenient.

It is important to the progress of both countries’ low- to middle-income groups that they consolidate as middle-income countries. It is a winwin situation, in a mutually beneficial environment, through policies, particularly in the economic sphere, that will lead to development.

Economic development is an important ingredient in building social cohesion, since it ultimately leads to peace, which, with development and co-operation, is important to the success of emerging markets.

Dr Survé writes in his capacity as chairman of the South African Brics business council.