Parks Tau took office as the new Minister of Trade, Industry, and Competition in mid-2024 after South Africa’s elections, confronting several challenges as the country navigates a complicated landscape of international relations and priorities.

Under the BRICS+ framework, South Africa seeks to expand its trade and investment prospects with both the founding and new members of the bloc. For more than ten years, China has been South Africa’s leading trade partner, but the partnership faces imbalances, mainly characterized by the export of raw materials and the import of finished goods.

Tau is focused on fostering strong relations with the United States, highlighting the country’s stance of non-alignment in global politics. This initiative has gained momentum as the deadline for the renewal of the African Growth and Opportunity Act (AGOA) approaches in 2025.

Since its launch in 2000, AGOA has allowed eligible sub-Saharan African countries to access the US market duty-free.

As the continent’s most diversified economy, South Africa stands to benefit significantly and is actively pushing for the initiative’s renewal while strengthening relationships with the new administration.

African agenda

The country is equally committed to promoting its African agenda, with the success of the African Continental Free Trade Area (AfCFTA) being crucial to its policy framework.

Tau emphasized that South Africa intends to leverage its international partnerships, including its G20 chairmanship in 2025, to promote a constructive trade agenda, not only for the Global South but particularly for Africa. South Africa is currently the sole African nation in the G20, along with the African Union, which now also holds a seat.

South Africa is balancing its international trade strategies with domestic export-oriented policies. As a participant in the AfCFTA, it aims to enhance trade under the agreement, especially as it is the largest exporter of finished goods in Africa.

At present, around 25% of South Africa’s total exports are directed toward other African countries, particularly those in Southern Africa, which constitute 90% of its exports.

In 2022, manufactured goods accounted for 64.3% of South Africa’s exports to Africa, compared to 43.9% of its global exports.

South Africa began trading under the AfCFTA in January 2024 through the Guided Trade Initiative—a pilot program aimed at evaluating the operational, institutional, legal, and trade policy landscape as qualifying nations start to engage more comprehensively in the initiative.

High-growth sectors

According to Tau, industrial policy is central to South Africa’s economic development approach, with a shift towards high-growth sectors that provide significant returns: “these sectors include the green economy, smart agriculture and agro-processing, automotives, iron and steel, organic chemicals, and the digital economy,” he notes. The policy will also maintain a strong emphasis on local content to develop skills and encourage demand for targeted manufactured products.

The government is partnering with the private sector to address major infrastructure and logistical challenges as it prepares to increase exports.