China's zero-tariff policy opens new trade and investment opportunities for South African businesses

China's zero-tariff treatment for African countries is creating new opportunities for South African exporters, manufacturers and small businesses to expand into the Chinese market, while strengthening calls for more balanced trade, local industrial development and job creation, officials said at a briefing reception in Pretoria on Thursday.

The event, held at the CT Hotel, brought together South Africa's Minister of Trade, Industry and Competition, Parks Tau, Chinese Ambassador to South Africa Wu Peng, South African Revenue Service (SARS) Interim Deputy Commissioner Schalk Human, government officials and business representatives to discuss the implementation of China's zero-tariff policy and its practical implications for South African businesses.

The policy, which took effect on May 1, 2026, extends zero-tariff treatment to 53 African countries that maintain diplomatic relations with China. South African products that meet the applicable rules of origin can enter the Chinese market without customs duties, subject to the scheme's provisions and specified tariff-rate quotas. The arrangement is scheduled to run until April 30, 2028.

Addressing the gathering, Tau described the initiative as an important step in strengthening South Africa's economic relationship with China, its largest global trading partner. He emphasized that the opportunity must translate into tangible benefits for the domestic economy, particularly through increased production, value addition and employment.

“Predictable market access gives investors the confidence to build production in South Africa,” Tau said, stressing that the country's objective was not simply to increase trade volumes, but also to attract investment that would establish more factories, expand processing capacity and create jobs locally.

According to Tau, bilateral trade between South Africa and China reached R642 billion in 2025, up from R483 billion in 2021. South African exports to China increased from R198 billion to R222 billion over the same period, while imports from China rose from R284 billion to R420 billion.

He noted that the zero-tariff initiative presented an opportunity to improve the structure of this trade relationship by helping South African businesses diversify their exports beyond traditional mineral commodities and increase their participation in higher-value industries.

The implementation of the policy has also required practical adjustments to South Africa's customs administration. Following amendments to the Customs and Excise Act, SARS began issuing certificates of origin to eligible exporters, enabling qualifying goods to benefit from the preference. Tau said the certificates could also be issued retrospectively for eligible goods shipped from May 1, 2026.

Between June 1 and August 31, SARS issued 25,975 certificates of origin, while customs declarations increased by 199 percent year on year, according to the minister. These figures indicate a significant increase in the use of the new trade arrangement during its initial implementation period.

Tau said the government was strengthening its export-promotion efforts through international trade fairs, targeted selling missions, hosted buyer programs and direct business-to-business engagements. South Africa has also developed a portfolio of 100 value-added products for the Chinese market, covering sectors including agro-processing, beverages, chemicals and pharmaceuticals, cosmetics, machinery, medical equipment, automotive products, fabricated metals, plastics and rubber.

Chinese Ambassador Wu Peng said the initiative was already contributing to positive momentum in bilateral trade and could support a broader transformation in the composition of South African exports.

According to figures cited by Wu from SARS, trade between the two countries reached nearly $15 billion between May and August 2026, representing an increase of almost 24 percent compared with the same period last year. South African exports to China amounted to $5.3 billion, up nearly 25 percent year on year, while imports from China totaled $9.47 billion, an increase of 23 percent.

Agricultural exports also recorded growth during the period, reaching nearly $500 million, up more than 35 percent year on year, Wu said.

The ambassador highlighted the potential for South African agricultural products to reach a wider consumer base in China, noting that the two countries had signed a protocol in September to facilitate South African cherry exports to the Chinese market. Further discussions on market access for other agricultural products are expected to support the expansion of export opportunities.

Beyond agriculture, Wu pointed to growth in South African exports of machinery and electronics, chemicals and passenger vehicles. Between May and August, non-mineral exports to China increased by 21.8 percent year on year, according to the figures he cited. Machinery and electronics exports rose by 35.6 percent, chemical exports increased by nearly 63 percent, and passenger vehicle exports surged by 104 percent.

The developments suggest that the zero-tariff arrangement could help South African businesses explore opportunities in manufacturing and other higher-value sectors, alongside established exports such as minerals and agricultural commodities.

Wu also emphasized the relationship between trade and investment, saying that lower export costs could strengthen the competitiveness of companies operating in South Africa and encourage further investment in local production. Chinese direct investment stock in South Africa had reached nearly $12 billion, he said, adding that Chinese companies, including Chery and West China Cement, were expanding their investments or expressing an intention to do so.

The automotive sector illustrates the potential for trade cooperation to support industrial activity. Tau cited Chinese automaker Chery's acquisition of Nissan South Africa's manufacturing facility in Rosslyn, Pretoria, which officially opened in July 2026. The company retained 692 former Nissan employees and plans to expand to nearly 3,000 direct and indirect jobs. He also highlighted BAIC's joint venture with South Africa's Industrial Development Corporation to manufacture and assemble vehicles locally.

Cooperation in electric vehicles, battery manufacturing and energy storage could provide further opportunities for industrial development. Tau said the Industrial Development Corporation was supporting a feasibility study on local battery-cell manufacturing and pursuing partnerships in battery-mineral processing, battery components and battery energy storage systems.

Both officials stressed that the longer-term benefits of the zero-tariff policy would depend on predictable market access and sustained cooperation between the two countries.

Tau said South Africa and China were pursuing negotiations through the Southern African Customs Union (SACU) towards an Early Harvest Arrangement intended to provide greater certainty for trade beyond the current two-year zero-tariff period. The negotiations are also expected to establish safeguards that protect South African industry and employment.

Wu said the first round of negotiations on the Early Harvest Arrangement had concluded in Beijing on Wednesday, Oct. 21, with the two sides hoping to sign an agreement early next year. He added that China intended to consult South Africa and other African countries on comprehensive economic partnership agreements covering trade, investment, services, supply chains and the digital economy.

For South African businesses, the immediate priority is to understand the requirements for accessing the Chinese market and identifying products with commercial potential. The two governments are seeking to connect the policy with practical export opportunities rather than treating tariff reductions as an end in themselves.

Tau urged exporters to obtain the necessary certificates of origin, engage government officials on the barriers they encounter and participate in upcoming trade-promotion activities. He also encouraged businesses to attend the China–Africa Economic and Trade Expo South Africa Session, scheduled for Nov. 19 to 21 at the Sandton Convention Centre. The event, to be co-hosted by the Department of Trade, Industry and Competition, the Gauteng provincial government and China's Hunan provincial government, will include an "Export to China" session showcasing South African fruit, wine, agricultural products, minerals and jewelry.

The minister also acknowledged requests from the wine industry to simplify the certification process by allowing the Department of Agriculture, which already certifies wine exports electronically, to issue certificates of origin. He said the government was considering the proposal to reduce administrative requirements for exporters.

Wu encouraged South African businesses to share specific feedback on their export experiences, product requirements and the challenges they face in accessing China. He said the Chinese side hoped the initiative would help promote more balanced bilateral trade, improve the structure of exports and support South Africa's industrialization.

The reception attracted close to 400 registrations, exceeding the 250 participants initially anticipated, according to Tau, reflecting strong business interest in the new arrangement.

As South Africa and China deepen their economic partnership, the central challenge will be to convert preferential market access into sustained commercial relationships, greater local production and broader participation by South African businesses. For exporters, particularly small and medium-sized enterprises, the policy offers an opening into one of the world's largest consumer markets, with its long-term value depending on the ability to meet demand, comply with market requirements and build competitive products.

The discussions in Pretoria underscored a shared ambition to move beyond increased trade figures towards a partnership that supports investment, industrial development and employment, ensuring that the opportunities created by zero tariffs deliver practical benefits for businesses and communities in both countries.