Business
As Africa grows, South Africa ceases to become continent’s gateway
South Africa’s membership of the bloc of leading emerging economies and its unique position in Africa heralded the country’s role as a gateway into the African continent. However, trade experts are beginning to question whether it can live up to this position as investors begin to increasingly look towards other African markets.
In 2003 South Africa became part of the IBSA grouping (India, Brazil and South Africa), and seven years later it joined the bloc of countries now known as Brazil, Russia, India, China and South Africa (BRICS).
Economists have predicted that the dynamic growth of the BRICS countries will bring about a shift in economic power toward the developing world. South Africa, as the most developed country in Africa, offers the infrastructure and services to unlock the region’s frontiers, they say.
With the International Monetary Fund (IMF) forecasting 2012 growth figures averaging around 6 percent for sub-Saharan Africa, and with countries like Angola raking in GDP growth of almost double that, the continent is touted as the investment destination of the decade.
Africa’s population of just over 1 billion pales in comparison with Asia’s 3.8 billion, but the African market is largely untapped and most countries find themselves on a firm growth trajectory.
South Africa, therefore, should be the logical first port of call for investors. But regional trade experts gathered at a mid-March forum on South Africa’s Trade Policy, organised by the South African Institute for International Affairs (SAIIA), questioned the gateway concept.
“Yes, South Africa represents the continent in the G20 bloc of nations, but that is not the point,” said Peter Draper, senior research fellow with SAIIA.
