An analysis of Nigeria-South Africa bi-lateral trade relations

Nigeria's President Muhammadu Buhari is currently on a 3-day state visit to South Africa, where he will be hosted by South African President Cyril Ramaphosa. The visit features a Joint Business Forum with a focus on trade and investment. CNBC Africa discussed the significance of the visit with Tilewa Adebajo, CEO of CGF Advisory, and Pabina Yinkere, Chief Investment Officer at Sigma Pensions. The discussion centered around the potential for fostering deeper economic ties between the two largest economies in Africa. The visit comes in the wake of xenophobic attacks in South Africa, opening up discussions on the need for cooperation to promote economic prosperity and intra-continent trade. Key Points: 1. Focus on Trade and Investment: The meeting between Presidents Buhari and Ramaphosa highlighted the trade aspects of the bilateral relationship. A total of 32 bilateral agreements were signed, signaling a commitment to strengthen economic ties. The emphasis was on exploring opportunities for collaboration in various sectors to enhance trade volumes between the two countries. 2. Addressing Security Concerns: Efforts are being made to improve security measures, especially for foreigners, following the xenophobic attacks in South Africa. The discussions included setting up an early warning mechanism to prevent future incidents and promoting greater awareness and understanding among the local population. 3. Promoting Intra-Africa Trade: With Nigeria exporting $63 billion worth of goods and services annually, only 12% of these exports are within the African continent. There is a significant potential to increase trade within Africa, especially with Nigeria and South Africa being the largest economies on the continent. The upgrade of the Bi-National Commission to a presidential level signifies a strong commitment to enhancing cooperation and narrowing existing trade gaps. In a statement, Tilewa Adebajo highlighted the need for both countries to leverage their strengths and resources for mutual benefit. He pointed out the imbalance in trade figures, with Nigeria exporting more than it imports from South Africa. Adebajo emphasized the potential for Nigerian businesses to expand into various sectors in South Africa, beyond the dominant crude oil trade. Pabina Yinkere underscored the importance of job creation and economic empowerment to address underlying issues that may lead to social unrest. He noted the need for strategic long-term interventions to tackle unemployment and promote economic stability in both countries. Yinkere also called for a collaborative approach at the chamber of commerce level to identify areas of mutual interest and explore opportunities for trade and investment. Quote: "Africa is the final frontier in terms of economic growth...both Nigeria and South Africa need to work hand in hand to drive growth on the continent." - Tilewa Adebajo The discussions on CNBC Africa highlighted the potential for Nigeria and South Africa to play a critical role in advancing economic prosperity within Africa. By strengthening their bilateral trade relations and fostering closer cooperation, the two countries can contribute significantly to the growth and development of the continent.