Brexit will not disrupt trade relations between UK and South Africa

South Africa’s Trade and Industry minister Rob Davies has stated that Brexit will not disrupt trade relations between the UK and SA. Davies said the Southern African Customs Union (Sacu), of which SA is a part, is close to finalising a deal with the UK to replicate the existing economic partnership agreement which the customs union has with the EU. Sacu is a customs union in Southern Africa which includes SA, Botswana, Lesotho, Namibia, and Eswatini (Swaziland). 

The UK is due to leave the EU with or without a deal in March 2019. With no deal in place, Britain would immediately fall outside the EU’s trade regime.

The UK, a major investor in SA, is the world’s sixth-biggest economy, with a GDP nearly nine times the size of SA’s. The country was SA’s sixth-largest global trading partner in 2017, with total trade at R79.5 billion (€4.88 bln)

In November British high commissioner to SA Nigel Casey confirmed that the UK is engaged in negotiations with Sacu to ensure that there is an agreement in place in the event that the UK leaves the EU without a deal, though it will not have any force and effect in a negotiated withdrawal as transitional arrangements — including the continuation of the economic partnership agreement between Sacu and the EU — will apply until end-2020 or end-2022 at the latest. Casey said having an agreement in place would provide clarity and certainty to Southern Africa and UK exporters.

Businesslive.co.za reports that with about 1.2-billion people on the continent, the agreement is set to create one of the largest free-trade zones in the world. Intra-African trade remains very low compared to other major regions in the world such as the EU and Asia. Davies said though total trade among African countries is still low compared to other continents, he is hopeful that platforms such as IATF will pave the way to increase trade within Africa.


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