South Africa eyes wine exports to China

South Africa's Trade and Industry Minister Rob Davies will be leading a delegation to the upcoming China International Import Expo (CIIE) in Shanghai, with the aim of promoting trade and investment to the world's largest source market.

A key focal area for the minister and his department will be to promote key job creating industries, such as Agriculture and Agro-Processing, as these are the sectors which employ the largest amount of unskilled labor in the country.

Wine exports to China will also be a particular focus for the delegation, as South Africa's traditional wine export market in Europe is showing anemic growth and local wine producers believe there is just a one percent profit margin on sales.

A sommelier pours wine during the 21st annual celebration of the Franshoek Bastille Festival, on July 12, 2014, about 70Km from the centre of Cape Town. [Photo: AFP/RODGER BOSCH]

China offers much better prospects as there are no locked in price point perceptions on South African wines and market share in the country is increasing; the Western Cape alone increased wine exports to China by 109 percent from 2017 to 2018. 

Minister Davies believes the CIIE is an event of scale that will bring together thousands of procurers from China and is a unique opportunity to showcase the country's products and industries.  

The Minister also said that South Africa has a significant trade deficit with China, exporting primarily middle commodities, but the country is making active attempts to balance the trade relationship, not only with wine exports but also meat and other value added products

He also added that Chinese President Xi Jinping announced on a state visit prior to the BRICS summit that China will be investing 14 billion US dollars into the South African economy, which will create a stronger, more mutually beneficial relationship between the two countries which will also cascade into very important job creating industries, such as wine.

South Africa will be exhibiting at both the national stand and the business pavilion at the CIIE along with Wines of South Africa, which will be looking to meet new procurers from China and come back with a new path towards growth for the local wine industry.