Lesotho trumps China as SA trade partner

South Africa exported more manufactured goods to Lesotho in 2016 than it did to China, said Duncan Bonnet, partner at specialist Africaconsultancy, Africa House. He made the comment during last week’s FTW/ Johannesburg Chamber of Commerce and Industry (JCCI) breakfast seminar held at JCC House in Johannesburg. Presenting ‘Logistics in Southern Africa: Opportunities and Challenges for South Africa’, Bonnet said he had been angered by the general attitude of South Africans towards the mountain kingdom following the recent shooting of that country’s defence force commander and two other military officials. The wife of current Lesotho Prime Minister, Tom Thabane, was also shot and killed the day before his inauguration in June this year. “We have to be sensitive to these domestic issues,” he commented. South African export trade statistics for 2016 confirm that Lesotho is the 7th largest export destination in Africa for South African goods, with R16.8 billion of product, mostly informal trade, exported to Lesotho in 2016. “That figure doesn’t include the two million Basotho people who visit South Africa every year, many of whom are coming to the country to buy goods and trade informally,” he added. Bonnet said the real-world figure, therefore, was probably in excess of R20- billion a year. “Our largest export destination globally in 2016 was China at R100 billion. But, if one removes coal and iron ore exports – and the jobs that go with them – we realise we exported more to Lesotho than we did to China.” South Africa’s exports to China are predominantly raw materials and jobs, while its exports to Lesotho are value-added, manufactured products. After China, the United States and Germany, South Africa’s next two biggest export destinations in 2016 were Namibia and Botswana.  “South Africa has a complete lack of understanding of the importance of its neighbourhood. We need to start taking cognisance of the fact that these countries play a very large role in the health of South Africa’s economy, particularly in the manufacturing sector,” he continued.  Bonnet said the Southern African Development Community (SADC) was a huge organisation that covered a massive area. “It is not a well-run organisation from a regional perspective. The East African Community has been a lot more proactive than SADC – which is quite a sloppy institution.” He said South Africans should understand the domestic pressure component on South African goods in the region. “We need a joint approach that says: ‘Let’s unlock this region, not just from a South to North perspective, but from an industrialisation perspective.' We can’t just be exporters into Africa; we have to become development partners,” he said. 

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South Africa has a complete lack of understanding of the importance of its neighbourhood. – Duncan Bonnet