SOUTH AFRICA AND SAUDI ARABIA FORTIFY TRADE AND INVESTMENT TIES

24 JANUARY 2024

In a bid to elevate economic collaboration, the South African – Saudi Arabia Business Council has pledged to enhance trade between the two nations. Notably, South Africa’s exports to Saudi Arabia rose to R7.3 billion in 2023, marking an increase from R6.6 billion in 2022. However, imports from Saudi Arabia decreased to R54.6 billion in 2023 from R73.6 billion in the previous year.

A diverse array of exported goods, including agricultural products, motor vehicles, and basic chemicals, underscores the evolving nature of this economic relationship. Conversely, imports predominantly featured refined petroleum and related products, as well as crude oil.

Speaking at a press briefing welcoming the Saudi business delegation, Co-Chair of the South African–Saudi Arabia Business Council, Stavros Nicolaou, emphasized the imperative to amplify trade and investment. Nicolaou noted the burgeoning opportunities in the Saudi market for South African companies seeking expansion in the Gulf region.

President Cyril Ramaphosa and Minister of Trade, Industry, and Competition, Mr Ebrahim Patel, have spearheaded ongoing discussions resulting in local businesses gaining traction in the Saudi Arabian market.

Dr Hisham Al Amoudi, Vice-Chairman of the Saudi–South Africa Business Council, affirmed Saudi Arabia’s commitment to investing in South Africa. Al Amoudi stressed the significance of the South Africa and Saudi Arabia Joint Economic Commission and Business Council as a pivotal platform for advancing bilateral economic interests.

“We are committed to increasing investments for mutual benefits and supporting South Africa’s economic growth. Our current investments contribute to South Africa’s Gross Domestic Product,” said Al Amoudi.

The visit by the Saudi business delegation aims not only to solidify existing trade relations but also to explore opportunities for South African companies to expand market access. Products with high export potential to Saudi Arabia include motor vehicles, fruits, mineral resources, chemicals, machinery, and electrical equipment. The Saudi delegation is keen on boosting investments in sectors beyond South Africa’s renewable energy industry, where it already stands as the largest investor.

The Business Council concentrates on five primary workstreams: Energy and Renewable Energy, Tourism, Hospitality and Entertainment, Healthcare and Pharmaceuticals, Mining and Commodities, and Food and Agro-processing. These areas aim to harness Saudi Arabian investment while leveraging the opportunities that South Africa presents in these sectors. Currently, Saudi investment in South Africa is estimated to be around $1.62 billion, with a focus on fostering mutually beneficial economic growth.