An African Agenda

In the last ten years, bilateral trade between Nigeria and South Africa has strengthened enormously, providing an example of the developing force of intra-African partnerships. What initiatives have driven this growth over the last few years?

South Africa regards Nigeria as one of its most important partners on the African continent in pursuing the vision of Africa’s renewal. In this regard, South Africa views its relationship with Nigeria as an enduring “strategic partnership,” centered on the advancement of the African agenda. In 1999, South Africa and Nigeria established a structured bilateral mechanism, the Bi-National Commission (BNC). At its inception, the primary objective of the partnership was to anchor and strengthen the existing bilateral, historical, political, economic, and social relations between the two countries, which would invariably also benefit other countries on the continent. The BNC further serves to promote trade and investment. The two countries have since signed more than 34 bilateral agreements and MoUs, which are coordinated through the BNC and in turn are led by the respective deputy and vice presidents of both countries. With its large population and vast natural resources, especially oil and gas, Nigeria is South Africa’s key trading partner on the continent providing significant opportunities for its exports and investments. There are over 100 South African companies doing business in Nigeria in various sectors, mainly telecommunication, banking, retail, property, entertainment, and hospitality. Nigeria is one of the few countries that enjoys a positive trade balance with South Africa.

How can African nations work together to develop a policy response to the new status quo, particularly in terms of regional economic integration?

In our view economic integration encompasses three pillars, i.e. market integration, infrastructure development, and continental industrialization. Continental integration efforts are being intensified through the negotiation of the Tripartite Free Trade Agreement. Africa is made up of five economic regional communities and these structures are tasked with negotiating a much closer working relationship which would ultimately lead to an Africa-wide Free Trade Agreement, with a potential single market of over 1 billion people. Considerable progress has been made in the negotiations, which aim to integrate 26 countries of eastern and southern Africa. This involves a population of nearly 600 million people and a combined GDP of $1 trillion. This market scale could launch a sizable part of the continent on a new developmental trajectory. There is a need to redefine and to strengthen our partnerships on the continent towards realizing the vision of an integrated Africa, underpinned by greater levels of intra-Africa trade and even greater levels of intra-Africa investments. African countries need to trade among themselves and there are good programs through various organs of the African Union aimed at promoting trade amongst Africans within the continent and to promote regional integration.

What opportunities are there for investors in African infrastructure?

South Africa’s imports from Nigeria are comprised mainly of oil and gas. Since 1999, there has been an increase in the number of SA multinationals operating in the Nigerian market. Currently, there are estimated to be more than 100 South African companies doing business in Nigeria. The biggest investment by South African companies in Nigeria has been in the telecommunication sector. Statistically, Nigeria is the biggest source of tourist origin, contributing about 84,589 tourist arrivals into South Africa in 2013. Nigeria alone contributed about 64% of the total tourist arrivals from the West Africa Region in 2013. Lack of access to trade-enabling infrastructure on our continent is a fundamental challenge. There is increasing recognition that Africa’s integration and intra-Africa trade cannot be realized without concerted efforts to invest in Africa’s infrastructure and manufacturing sectors. We have an extensive infrastructure development program championed by the heads of state and government through the Presidential Infrastructure Championing Initiative. We want to continue building infrastructure such as roads, railways, bridges, dams, and airports to make it easier to travel around the continent. The African heads of states have committed themselves to continue building cross-border infrastructure, to unlock growth and development in our continent.