South Africa's major exports to China are mining products, especially iron and steel, heavy chemicals and nonferrous metals. In contrast SA imports Chinese clothing, machinery, televisions, communication equipment, furniture and footwear. The Congress of South African Trade Unions (Cosatu) has said that South Africa is running a R16 billion trade deficit with China that already has cost the country thousands of jobs. China is also exporting labour-intensive manufactured goods to SA, while SA exports capital-intensive commodities. This had led to SA creating jobs in China while Chinese imports had destroyed jobs in this country, Cosatu says. Unions in the textile sector have called on regional governments to enforce World Trade Organisation safeguards against China, but government is wary of this step for fear of Chinese retaliation against South African imports. Government has said it preferred to negotiate a free-trade deal with China that will protect SA's vulnerable industries.
A joint venture by Tracy Hon and Benjamin Zhang, trading under the name China Experience Trade and Tours, offers Chinese students and business executives the chance to learn English in South Africa, see the country and explore South Africa's trade options. South Africa's largest fruit-marketing company, Tru-Cape Fruit Marketing, made an agreement with the Shaanxsi province agricultural research agency in China whereby it has the exclusive rights to produce 6 apple varieties of the Fuji strain for 20 years. Not only is the Fuji apple one of the world's best varieties of apple, but it also has a higher yield than most strains of apple that are grown in the Cape at the moment. Tru-Cape Fruit Marketing has made a similar arrangement with the Hebei provincial agricultural research agency to produce 4 varieties of pears such as the Ya Li pears. Once the governments of China and South Africa have sorted out phytosanitary regulations that forbid trade in apples and pears between the two countries and production in SA commences, it is anticipated that this will give a big boost to the export trade in these fruits.
South Africa’s Sasol and Wilmar Holdings have agreed to form a joint venture to build a fatty alcohols plant in the industrial port city of Lianyungang in China. At 60 000 tons a year, the plant would be the first “world-scale” alcohol plant in China. Fatty alcohols are used to produce a wide range of goods such as cosmetics, textiles and detergents. Construction was expected to start in September 2005 and the plant could be commissioned by the middle of 2007, subject to the board approval of both companies. Sasol would be the exclusive distributor for the sales and marketing of the alcohols produced by the joint venture. The feedstock would be fatty acid, produced at the same location by Wilmar.
China Resources Snow Breweries Limited, an associate of SABMiller plc and a subsidiary of China Resources Enterprise Limited, announced that it has entered into an agreement with the Fuyang City government to acquire the assets of the Fuyang City Snowland Brewery Company in Anhui province for a cash consideration of US$15 million. The announcement follows the acquisition in June 2004 of a 90% interest in the Shucheng and Liuan breweries in central Anhui, which produce the ‘Longjin’ brand.
