SA’s trade ties with Russia don’t measure up

The historic and cordial political relations between South Africa and Russia have not translated into trade and the current import trade deficit with the Russians worries many local businesses, who wanted greener trading pastures in Russia.

In 2022, South Africa imported goods worth $548 million (about R10 billion) from Russia – most of that chemicals and fertilisers – but exported just $283 million, most of which was citrus fruit.

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Speaking at the country session of St Petersburg International Economic Forum (Spief) in Sandton last week, Brics Business Forum members Stravos Nicolaou and Elias Monage stressed the need for a special focus on changing the import-export ratio between the two countries, if SA is to benefit from their relationships.

The two businessmen are hoping local exporters will support the 27th Spief 2024, to be held in St Petersburg in Russia, from 5-8 June.

Nicolaou said South Africa ran a trade deficit within the Brazil, Russia, India China and South Africa economic alliance.

The deficit was even greater with Russia, its Cold Warera ally and its main backer in the fight against apartheid.

By comparison, South African trade with its other Brics partner, China, is much bigger than that with Russia. There is also more of a balance between imports and exports.

In 2022, South Africa imported goods worth $23.5 billion from China, most of that trade coming from electronic equipment and batteries, while this country exported $23.4 billion of goods to China, the biggest component of which was gold, valued at $8.85 billion.

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Nicolaou decried the ongoing trade deficit between SA and Russia, calling it “unfortunate”, adding it needed to be addressed.

“What we would like to see is more South African finished products being exported to Russia.” Spief could be a conduit for that, he added.

Monage, who is president of the Black Business Council, said the more than 30 years’ political links between the ANC and Russian lacked the trade component.

“The diplomatic relations between the two countries do not translate into trade. As a result of that, this has created this trade imbalance,” Monage said.

He said there were more opportunities in Spief than at the World Economic Forum gatherings in Davos.

The fact that there were no direct flights between South African and Moscow was a hindrance to improved trade between the two countries.

This ought to be addressed so that South African businesses could tap into new markets in Russia.

With its long political connection with Russian, South Africa could have had at least between four and five nuclear power plants and an extensive gas economy as an alternative energy for domestic heating.