China-US Trade Tentions: Dispute affects trading partners, emerging markets
Updated 10:39, 01-Sep-2018
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The trade dispute between the United States and China continues to affect emerging market. South Africa is one of them. CGTN's Angelo Coppola spoke to trade finance expert Doctor Greg Cline.
ANGELO COPPOLA CGTN CORRESPONDENT "How is this trade war, this trade spat, affecting South African industry?"
DR GREG CLINE, CORPORATE ACCOUNTS HEAD INVESTEC IMPORT SOLUTIONS "What it means for South Africa is that China is looking for alternative markets, in order to be able to continue exporting, and there's been a long established history with South Africa and China. South Africa is an investment friendly environment for China. So if anything it's promoted an increase in trade between the two countries. South Africa imports about 84 billion dollars worth of goods, every year into the country. China is responsible for about 16 or just over 16 billion of that.
ANGELO COPPOLA CGTN CORRESPONDENT "Now let's turn to the impact that this spate has had on imports into South Africa?"
DR GREG CLINE, CORPORATE ACCOUNTS HEAD INVESTEC IMPORT SOLUTIONS "We are one of the only economies in the world, where Amy import product, the importer gives terms, the logistics company gives payment terms to the importer. And what we are seeing is that importers are looking for that term, either from their supplies overseas. So they'll ask for suppliers from China, which some may or may not have, depending on those relationships, and if they don't get the term, they come to the banks."
ANGELO COPPOLA CGTN CORRESPONDENT "This dispute, that we are currently seeing, how's it impacting on South Africa's economy?"
DR GREG CLINE, CORPORATE ACCOUNTS HEAD INVESTEC IMPORT SOLUTIONS "I think what you'll start to see is that we will begin to leverage the trading blocs such as BRICS, and those relationships to enable better trade between countries that are sitting within Africa, from SADEC, up north, right through to China and Brazil."
ANGELO COPPOLA CGTN CORRESPONDENT "So if we had to look ahead now, what do you see happening if this trade dispute, trade war continues?"
DR GREG CLINE, CORPORATE ACCOUNTS HEAD INVESTEC IMPORT SOLUTIONS "Companies are struggling to collect money, from their debtors, they're struggling to pay back their financial institutions and pay back their service providers and we think that there's going to be a bigger role to play in the trade finance layer. Just because the cash flow is problematic."