South Africa has remained one of three leading countries in the African export market, which reached $665.4 billion in 2022-2023 but was still below 3% of global exports, despite the ongoing challenges with the ports.
South Africa has been struggling to meet its export potential for the past few years, as a result of logistical bottlenecks experienced by state-owned rail and ports operator, Transnet, but these are being addressed speedily now in partnership with the private sector.
The inaugural 2023 Africa Export Competitiveness Report released yesterday showed that South Africa, along with Morocco, and Nigeria accounted for a significant share of total exports in the continent.
The report examines the export capacity and ecosystems of 30 African countries, and sheds light on the main factors and obstacles influencing Africa’s export competitiveness. The key findings provide a comprehensive understanding of the continent’s economic landscape, complexities, and main drivers to foster an intensification of intra-African trade and African exports.
According to the report, South Africa, Morocco, and Nigeria were the dominant players in Africa’s export dynamics.
In 2022, South Africa emerged as the foremost exporter on the African continent, followed by Egypt, Algeria, Morocco, and the Democratic Republic of Congo.
South Africa, in particular, played a pivotal role, contributing to nearly one-fourth of the total exports within the region, particularly mining metals and high-technology exports, while Egypt accounted for 12% of African exports.
Notably, South Africa exhibited an improved performance in 2022, with its share of Africa’s exports rising marginally from 22.41% in 2021 to 23.38% in 2022.
This consistent prominence over the years underscored South Africa’s position as a leading exporter of goods and services on the African continent.
Throughout the years spanning 2000 to 2021, South Africa, as the primary contributor to African exports, maintained a positive compound annual growth rate in its share of African exports, registering an increase of 0.51%.
This enduring trend affirmed South Africa’s sustained dominance as the highest exporter of goods and services over the specified period.
The report was published by the Arab Bank for Economic Development in Africa (BADEA), in collaboration with the African Capacity Building Foundation (ACBF), Shift Impact Africa, the Institute for Competitiveness Africa (IFCA), and the Institute for Competitiveness India.
Dr Amit Kapoor, a visiting scholar at Stanford University and honorary chairman of the Institute for Competitiveness India, said the report offered an aggregated overview of the continent’s competitiveness based on Professor Michael Porter’s foundational competitiveness framework.
“Our data-driven benchmark methodology evaluates the export performance of African nations, assessing export-related competitiveness and fostering peer-to-peer learning by highlighting best practices,” Kapoor said.
“The report further analyses export conditions, underscoring fundamental drivers and challenges. By assessing national export capacities and ecosystems, 30 out of 54 African countries were assessed based on their current performance.
“In its pilot phase, ongoing evaluations will build upon this foundation with a commitment to including all African nations in future editions of the report,” he said.
The report said foreign direct investment (FDI) in Africa amounted to $44bn in 2022, a significant fall from the record-breaking $80bn in 2021.
The fall in Africa’s FDI inflow aligned with global trends as FDI inflows declined by 12% in 2022 from $1.47 trillion in 2021 to $1.3trln.
Africa’s share of global FDI amounted to 3.47%, which is the lowest among the continents.
In 2022, around 50% of the FDI inflow was received by just five countries, namely Egypt, South Africa, Ethiopia, Senegal, and Lithuania having shares of 25.3%, 20.1%, 8.1%, 5.75 and 4.7%, respectively.
This highlighted the uneven distribution of FDI in African countries, resulting in unequal access to foreign capital among these nations.
The report was developed with a single purpose in mind: To become a regular benchmark publication and a world-class reference in its field.
“We hope policymakers, development partners, and business leaders across Africa will reference it as a key decision-support tool,” said Mamadou Biteye, executive secretary of the ACBF.
“It sheds light on strategic investments in infrastructure required as a foundation for Africa’s economic competitiveness, providing invaluable insights to guide the design of skills development programmes, and helping stakeholders shape regulatory reforms to improve the continent’s overall competitiveness,” Biteye said.
BUSINESS REPORT