China and South Africa have taken a major step toward deepening economic ties with the signing of a framework trade and investment agreement, the China-Africa Economic Partnership Agreement for Shared Development.

The agreement is designed to expand bilateral trade, facilitate two-way investment, and grant more South African exports duty-free access to the Chinese market.

Officials say the new agreement could open fresh opportunities for South African businesses seeking entry into the Chinese market, particularly across mining, agriculture, renewable energy, and technology.

What does the signing of the agreement signal about how China and South Africa are prioritizing the growth of trade and investment ties, especially in the context of the current international economic environment?

Emmanuel Matambo, Research Director at the Centre for China-Africa Studies at the University of Johannesburg, shares his insights.

Why the deal natters

Emmanuel Matambo points out that the agreement comes at a critical geopolitical and economic moment.

"We have to put this in a broader context. South Africa was adversely impacted by U.S. tariffs, so it made sense to broaden the scope of partners who can enhance trade relationships."

He noted that China is South Africa's largest trading partner and South Africa is China's largest trading partner in Africa, making the agreement both strategic and timely.

Matambo emphasized that the deal could help offset external trade shocks:

"This is going to be very significant for South Africa. It cushions the adverse impact of American tariffs on South African exports."

Sectors such as automotive manufacturing and citrus exports, previously impacted by tariffs, stand to gain from expanded access to China.

Key export opportunities

A wide range of South African sectors are positioned to benefit from the new trade framework. Agricultural exports are expected to see some of the earliest gains, particularly citrus fruits, rooibos tea, table grapes, and seafood, all of which have growing appeal among Chinese consumers.

Beyond agriculture, the agreement also opens space for growth in manufacturing exports, especially automobile parts and other value-added goods that South Africa is seeking to diversify into.

At the same time, the country's traditional strengths in mining and minerals, including chromium, copper, and diamonds, will continue to underpin trade flows, though policymakers are increasingly focused on moving up the value chain rather than exporting raw materials alone.

Four pillars of cooperation

Matambo stressed that the agreement rests on a broader architecture of cooperation that extends well beyond tariff reductions.

Trade cooperation forms the foundation, but it is being reinforced by a strong push for investment cooperation aimed at attracting Chinese capital into key South African industries.

Alongside this, new energy collaboration has emerged as a central pillar, with both sides exploring partnerships in renewable power and energy transition technologies.

Finally, the framework underscores deepening multilateral coordination, reflecting shared commitments to global trade governance and institutional cooperation.

"Trade cooperation was only one. Investment, new energy, and multilateral cooperation are equally important."

Investment and industrialization

South Africa is looking to leverage the agreement to attract deeper Chinese investment across strategic sectors. This includes expanding automotive manufacturing capacity, strengthening financial sector cooperation, accelerating renewable energy deployment, and advancing technology and digital innovation ecosystems.

Matambo pointed out that industrial relocation from China to Africa, leveraging Africa's young labor force, is a major long-term opportunity.

Multilateral and global implications

The agreement also reflects broader shifts in the global trade landscape.

Matambo linked the deal to growing support for multilateralism among emerging economies:

"If South Africa, China, and other countries recommit to multilateral trade rules, this bilateral deal has the potential to have global impact."

Both countries' roles in platforms such as the G20, BRICS, and the WTO were cited as avenues for deeper coordination.

（This newsletter was generated with the help of AI, drawing on the discussion transcript.）