ANC’s ‘Russia alliance’ could hurt car exports


There are substantial concerns about the effects on the vehicle manufacturing sector if South Africa is kicked out of the African Growth and Opportunities Act (Agoa) agreement due to the government’s cozy relationship with Russia.

The thriving vehicle manufacturing sector accounted for R157 billion in exports last year, while car trade accounted for 16.5% of South Africa’s overall trade GDP.

Should South Africa be kicked out of Agoa, however, this sector could say goodbye to 112 000 jobs and R435 billion in car trade.

John Steenhuisen, leader of the DA, Cilliers Brink, mayor of Tshwane and the DA’s caucus leader in the metro, and Solly Msimanga, Gauteng leader of the DA, were at the BMW manufacturing plant in Rosslyn on Tuesday morning to highlight the importance of the sector and stressing the dependence on the Agoa agreement.

Germany mainly imports vehicles manufactured in South Africa thanks to bilateral agreements of the European Union (EU) to the value of R72 billion.

South Africa is also a key manufacturer of right-hand drive vehicles for markets such as the United Kingdom. Companies such as BMW and Mercedes-Benz are key exporters to the US market.

“A large part of this trade is dependent on Agoa,” says Steenhuisen.

“The ANC’s alliance with Russia does not make economic sense if it means that almost 77% of foreign direct investment stock in recent years from the EU, the United Kingdom and the United States must be sacrificed for a country with which we trade only about 0 amounts to .3%.”