The year 2014 is an important year for South Africa. The first elections after the death of South African ex-president Nelson Mandela will take place and after twenty years of democracy, the world will be watching us again. The world holds much interest in the economy and politics of South Africa as was discussed in Appendix A and Appendix B and it is safe to assume that the world is a stakeholder in the politics and economy of South Africa.
The purpose of this essay is to explore the world’s stake in South Africa, its nature and what implications the 2014 elections has on it. I will be exploring the South African mining industry by looking at the current platinum strikes and its implications on foreign investors. I will be showing the effects of the South African economy and politics on South Africa’s biggest import and export partner China. I will go further by examining the President’s state of the nation address with the purpose viewing South Africa’s plans regarding the recent strikes in the mining sector if any such plans exist. I will move on to discuss South Africa’s political standings overseas by looking at BRICS, South Africa’s contribution to BRICS and politics surrounding this relationship. Further to Appendix B regarding South Africa’s involvement in international trade agreement, I will be describing some of these agreements to further understand South Africa’s political and economic standings abroad.
In Appendix B, I discussed South Africa’s biggest export and import partners and their contribution to the South African economy. I concluded that China remains the biggest import and export partner to South Africa. The nature of the trade relationship between South Africa and China is that, China imports natural resources from South Africa and in return, South Africa imports manufactured products from China. A question regarding the implications of the South African 2014 elections on China starts to immerge. The answer to this question requires us to look further into the trade relations between these two nations.
Chinese investments in South Africa have been mainly aimed at metals, chemicals, food and tobacco (South Africa. Department of Trade and Industry, 2013). This means that whatever changes are made or issues arise in the South African government regarding mining and farming for example, will be in the interest of the Chinese government. An example of such interest by Chinese investors can be seen in the current platinum strikes. South African exports mainly minerals, particularly platinum and gold and is very vulnerable to changes regarding demand and prices in the international commodity markets (South African Reserve Bank, 2014). South Africa has lost billions in the mining industry due to strikes which is causing favourable conditions for Chinese investors to acquire assets at cheaper prices (www.bloomberg.com, 2014). The strikes are estimated to run into the election period causing China and the rest...