Africa’s external relations

Africa’s external relations

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As Africa confronts the challenges of the evolving international trade landscape and an increasingly globalised world economy, the nature of its trading relationships has been undergoing significant shifts in recent years. While trade with its traditional trading partners, particularly the European Union and the United States, has been declining, trade ties with emerging economies and global players, notably the BRICS (Brazil, Russia, India, China and South Africa), has been steadily increasing. Africa also remains committed to pursuing regional integration initiatives that can contribute meaningfully to increased intra-African trade.

tralac has recently studied Africa’s trade relations in terms of a ‘friend’ analogy:

Old friends: Africa’s exports have traditionally been dominated mostly the EU and US In the past two decades, following the removal of sanctions on South Africa, the bilateral agreements as well as the preferential market helped provide access for South African products into these markets under either Trade Development Cooperation Agreement (TDCA) with the EU and the African Growth Opportunity Act (AGOA) with US. In addition, the EU is negotiations Economic Partnership Agreements (EPAs) with several ACP countries.

Good friends: Regional integration is an important policy objective, and African markets are growing in importance for agricultural, industrial and services exports from South Africa. The negotiations to establish a continental free trade area were launched in June 2015, and could offer more opportunities as many African countries are growing at rates much faster than the South African economy.

New friends: the so-called BRICs are new friends, with emphasis on the political dimension of the relationship. China is most competitive in industrial production, Brazil in agriculture and India in services.