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South Africa

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Map of South Africa Last Reviewed: 25 June 2009

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Trade and investment

Trade and investment with the UK

The UK is one of South Africa's most significant trading partners with over £8 billion in two-way trade in goods and services.  In recent years we have seen significant investment in South Africa by household British names such as Barclays Bank, Rolls Royce, Cadbury's, Vodafone, Virgin Mobile and Associated British Foods. This demonstrates that South Africa has enormous potential as an investment destination for UK companies, and with the 2010 FIFA World Cup™ in South Africa just around the corner, UK companies are already active in the country in the build-up to the world's biggest sporting event.

The strong commercial ties are an important element of the overall bilateral relationship. The UK Trade and Investment (UKTI) operation is headquartered in Johannesburg, with additional commercial colleagues in Cape Town. Collectively advice is given to over 500 UK business people, and some 15-20 trade missions and 4-5 exhibition groups per year visit South Africa and are assisted by the UKTI teams. The teams have an increasing responsibility for helping South African companies that are interested in investing in the UK.

There has been strong emphasis in UKTI activities on the opportunities likely to arise from the privatisation programme and the promotion of PPPs (Public Private Partnerships) in South Africa. These include opportunities in the water, airports, ports, healthcare, telecommunications and railway sectors. Other priority sectors include education and training, IT, tourism and the automotive industry.

Most of the provisions of the EU-South Africa Trade, Co-operation and Development Agreement (TDCA) came into force on 1 January 2000. The UK is the second largest European trader with South Africa (after Germany). The TDCA has boosted South Africa's trading prospects with Europe, and liberalisation towards a free trade area over the 12-year transition period will strengthen the UK's commercial position in South Africa.

UK Trade & Investment Country Profile: South Africa

Advance fee/419 fraud

Many people and companies in the UK (and elsewhere) receive letters, faxes and e-mails, purporting to come from Nigerian, and increasingly often South African, individuals or government departments, offering them large sums of money in exchange for allowing use of their bank accounts. These are frauds, and the money does not exist. Four One Nine fraud takes its name from the relevant section of the Nigerian Criminal Code.

Four One Nine fraudsters are increasingly using the internet as e-mails are more difficult for Law Enforcement Agencies to intercept. To give the fraud an air of credibility, the e-mails are often linked to current events or high profile individuals. The fraudsters also hack into authentic websites of banks and companies and copy details of their executives. Receipt of a 419 e-mail should be reported to the abuse team of your Internet Service Provider (ISP), for example abuse@yahoo.com. If you are in the UK and have actually lost money you should inform the Fraud Desk at the Metropolitan Police - Email: fraud.alert@met.police.uk

Frozen pensions

State pensions to UK residents in South Africa are not increased annually in line with inflation. Instead, they are frozen, either from the date the person first became entitled to a state pension, or from the date that they left the UK, depending on which is the later. Some pensioners living overseas do receive increases that keep their pensions in line with inflation, but only in those countries where the UK has reciprocal social security agreements. This is not the case in South Africa.

The issue of index-linking state pensions was the subject of a landmark Court of Appeal decision in the Annette Carson (UK resident in South Africa) case. This confirmed that the Government has no duty to up-rate state pensions to those living abroad where there is no legal requirement to do so, or where there is no reciprocal arrangement in place. An appeal lodged by Ms Carson was rejected by the House of Lords in May 2005.

Development

In 2006 the Department For International Development Southern Africa (DFIDSA) launched the Regional Plan for Southern Africa to work on growth and poverty with South Africa across borders in Southern Africa. The Regional Plan responds to the recommendations from the Commission for Africa and commitments made by G8 leaders in 2005 to give better and more aid towards Africa’s development. The plan will support the priorities of the African Union, NEPAD and SADC in the Southern Africa region. By 2010, DFID’s support will lead to:

  • South African supermarkets sourcing 30% more inputs from other Southern African countries (rather than on the international market);
  • a 5% increase in fruit and vegetable exports from Southern Africa;
  • more effective border posts with a 30% reduction in waiting time;
  • transport costs for landlocked countries reduced by 25% due to improved roads, ports and rail infrastructure;
  • at least three countries in the region able to predict and plan for hunger needs of their people;
  • malaria-related deaths falling by 50%;
  • a 50% increase in Tuberculosis case detection and treatment;
  • a reduction in HIV infection rates.

DFID-SA will join up with the other European Union donors to support poverty reduction in South Africa. We will work more closely with South Africa to further develop its role and influence in the region. Through the Regional Plan, we will contribute £100 million to poverty reduction in Southern Africa over the next five years.

United Nations Development Programme

World Bank

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