In today's globalised world, a country's economic performance is significantly inf luenced by its foreign policy, especially about its exports. South Africa is no exception, and economists are concerned that the country's current foreign policy, particularly in the context of its relationship with Russia, could trigger a negative response from other nations, which may result in trade damage.With South Africa's limited range of goods that it can sell abroad, the stakes are high, and a balanced approach to foreign relations was critical for safeguarding the country's economic interests, said Francois Fouche, an economist and researcher at the Centre for African Management and Markets at the Gordon Institute of Business Science.“The role of South African foreign policy in shaping the country's export potential is becoming increasingly crucial. However, if the current trajectory continues, including the possible hosting of President Putin for the upcoming Brics meeting, it may cross a critical line, making it exceedingly challenging to reverse course and recover from the potential damage to trade relationships.”Fouche said the country was best advised to tread carefully, being mindful of the potential backlash from its biggest trading partners who were keeping a watchful eye over the ongoing manoeuvres with Russia.He said the European Union was still the largest economic bloc in the world, accounting for 22% of South African exports. The United States, the world’s largest economy, accounted for 9% of South African exports. “Add the 7% that goes to the United Kingdom, and collectively South Africa exports 36% of everything it sells abroad to these three regions. Russia, on the other hand, accounts for only 0.2% of our expor ts.”Fouche said South A f r ica’s decision recently to abstain from voting at the United Nations on whether Russia should pull out of Ukraine was doing more harm than good to trade considering that 144 countries in total had voted against Russia.“We are voting against our trading partners. It does not make economic sense to do that. South Africa used to punch above its weight in diplomatic circles, but that is less and less the case. We are far less inf luential at present and the impact of this policy can be disastrous.”One scenario is the country losing its Agoa benefits. While it is unlikely that South Africa would be relegated out of Agoa completely, it could lose significant beneficiary status, and along with it, massive investment down the line.He said exports to the EU could also suffer significantly if South Africa did not change tack on its stance on Russia, although the existing trade agreement ensured some form of protection. “Unlike Agoa, the trade agreement’s benefits cannot simply be withdrawn. We may find, however, that it takes longer to negotiate improved market access into the market.”
