Stability in S Africa expected to power trade flow
TRADE and capital flows between post-election South Africa and Hong Kong and China are expected to grow greatly as the political scene in the once trouble-ridden country stabilises.
Not only would the multi-party government, elected by 86.7 per cent of the population, instil stability, the massive reconstruction programme as promised by the ruling party would stimulate economic growth, said Michael Farr, the country's consul-general in Hong Kong.
Trade flow between South Africa and Hong Kong, which reached US$1.2 billion last year, is heading for another strong year.
Trade volumes have grown more than 20 per cent in the past two years.
Hong Kong is South Africa's ninth largest investor and 11th biggest trading partner.
Although bilateral trade between South Africa and China amounted to only $650 million last year, it was a triple-jump from $200 million in 1992.
''If the indirect trade through Hong Kong was included, it should reach $1.2 billion,'' said Nicholas Burton, manager director of NedFinance (Asia), one of the two South African banks granted a restricted licence bank status in the territory.
Its name will soon be changed to Nedbank (Asia).
Even with no diplomatic relation between the South Africa and China, trade is expected to top $1 billion this year.
China mainly buys steel, coal, wool and gold from South Africa and exports textile and electronics products.