SA CAN expect an increase in trade flow from China after president Nelson Mandela announced last week that diplomatic ties with Taiwan would be cut in favour of the mainland.
Ties with Taiwan were a legacy of the past when it shared world rejection with the white SA government. At present China has only Ôcultural' ties with SA as it refuses to establish diplomatic links with countries that recognise Taiwan.
Taiwanese investments in SA are substiantial - more than 300 companies ranging from textile manufacturers to computer firms. However, these are not likely to be affected. Mandela said SA would continue to keep links with Taiwan but would no longer entertain diplomatic representatives or maintain its own embassy on the island.
China has encouraged Taiwanese investment in the mainland and is not expected to try to curb economic ties between the island state and SA.
The switch in policy could open significant trade and export opportunities for SA. China, with a population of more than a billion people, is a sought after market.
SA traders can therefore look forward to improved access to China while maintaining business ties with Taiwan.
