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SOUTH AFRICA - BULGARIA REPORT: A success story with further potential

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SOUTH AFRICA - BULGARIA REPORT: A success story with further potential

The dynamic development of bilateral relations between Bulgaria and the Republic of South Africa in all areas incl. in trade started with the establishment of diplomatic relations between the two countries on 13 December 1991.


While official Bulgarian exports to South Africa exploded from USD 21.5 million in 2005 to USD 151.3 in 2012, imports from South Africa also rose substantially from USD 10.8 million to USD 43.00 million. Accordingly, Bulgaria's exports to South Africa are more than fivefold higher than its imports from the African country. 2011 was a dramatic year in the Bulgarian-South African trade relations, as Bulgaria managed to achieve a positive trade balance for the first time in years, by rising its exports from USD 90.6 million in 2011 to USD 151.3 million in 2012.


YEAR 2005 2006 2007 2008 2009 2010 2011 2012
EXPORT  21.5  16.5  7.9  13.9  9.1  10.6  90.6  151.3
IMPORT  10.8  28.6  13.8  20.9  41.9 14.5   28.2  43.0
TOTAL  32.3  45.1  21.7  34.8  51.0  25.1  118.8  194.3
BALANCE  +10.7  -12.1  -5.9  -7.0  -32.8  -3.9  +62.4  +108.3

Bulgaria-South Africa trade in USD millions. Source: Ministry of Finance

Importantly, transactions with South African partners primarily take place through third countries. The main reason for this is the significant import of Bulgarian products in RSA, which is done through third countries (such as Italy, Spain and Portugal) and is accordingly not recorded in the statistics as Bulgarian exports to RSA.

There has been a new wave of South African investments in Bulgaria, the most important of which is the ALC plant in Stamboliiski and the the Group 5 involvement with a Bulgarian partner in building a new gas power plant outside Sofia.

Perhaps the most significant recent development in the relations between the two countries is a plant for production of high-class auto upholstery in the village of Mussachevo, near Sofia, built with an investment of South Africa's ALC Company. About 500 workers have been producing upholstery for the BMW models since November 2011.

The companies Mondi, Group 5 and ALC have been attracted to Bulgaria for more or less the same reasons – low costs of production, low taxes and convenient transport links to the big markets of Central and Western Europe.

South Africa, historically an exporter of raw materials such as coal and manganese to Bulgaria, saw a 1,500% increase in the first six months of 2011 compared to H1 2010 in imports from Bulgaria, principally in the form of processed metal copper products.

South Africa, the powerhouse of the African continent

South Africa is a multiethnic society encompassing a wide variety of cultures, languages, and religions. Its pluralistic makeup is reflected in the constitution's recognition of 11 official languages, which is among the highest number of any country in the world. South Africa is ranked as an upper-middle income economy by the World Bank, and is considered to be a newly industrialised country, with a significant influence on the African continent. Its economy is the largest and most developed in Africa, and the 28th-largest in the world.

South Africa, a G 20 member, has the largest economy in Africa, in terms of both nominal GDP (at USD 390.9 billion in 2012) and GDP at purchasing power parity ( USD 585.6 billion in 2012)

The principal international trading partners of South Africa—besides other African countries—include Germany, the United States, China, Japan, the United Kingdom and Spain, which, to some extent overlap with those of Bulgaria. Africa is South Africa's foreign policy priority, while at the same time the EU is South Africa's largest trading partner by far.

South Africa, an economic and political powerhouse on the continent, is an important player in the African Union. In turn, the accession in 2007 of Bulgaria and Romania to the EU changed the dynamics of Pretoria's relations with Sofia and Bucharest.

South Africa is a middle-income, emerging market with an abundant supply of natural resources; well-developed financial, legal, communications, energy and transport sectors. Pretoria's stock exchange that is the 18th largest in the world South Africa's modern infrastructure supports a relatively efficient distribution of goods to major urban centers throughout the region.

The country saw a robust growth from 2004 to 2007 as South Africa reaped the benefits of macroeconomic stability and a global commodities boom. Then, however, the South African growth began to slow in the second half of 2007 due to an electricity crisis and the subsequent global financial crisis' impact on commodity prices and demand – a key to one of the world's largest raw material exporters. GDP fell nearly 2% in 2009 but recovered in 2010-12.

Unemployment remains high, at nearly one-quarter of the work force, and outdated infrastructure has constrained growth. Daunting economic problems remain from the apartheid era - especially poverty, lack of economic empowerment among the disadvantaged groups, and a shortage of public transportation.

20 years of diplomatic relations

The 20th anniversary of South Africa and Bulgaria establishing diplomatic relations, is also geared to enhance co-operation on South Africa's national priorities, such as skills development, education and job creation – which, in turn, means working to increase trade and investment.

Sofia has seen the arrival of a fully-fledged ambassador, Sheila Camerer and the expansion of the South African embassy in the Bulgarian capital. Currently, the highest ranking South African official in the country is deputy ambassador (charge d'etat) Boiki Moutlung.

Given the respective strategic positions of the two countries, Bulgaria in the south-eastern part of the EU and South Africa as the gateway to the enormous southern African market, trade and political ties are burgeoning to new levels between the two countries.


"There are not many South Africans here, 37 according to the latest census, but that is no bar to good relations. Almost all the South Africans here are married to Bulgarians and a lot of the Bulgarians in South Africa are married to South Africans and there is plenty of evidence that we like the same things, barbeques, outdoor relaxation; and we both like wine!" Sheila Camerer,
Ambassador of the Republic of South Africa in Sofia told earlier to Standart.

''Currently over 20,000 Bulgarian are residing in South Africa, the largest Bulgarian community lives in the industrial zones of Johannesburg and Pretoria. Most of them arrived to South Africa after the collapse of the communist regime; these are highly skilled medics, engineers, dentists, etc. '' she noted.

Potential of closer cooperation

South African wine exports to Bulgaria are up and through the endeavours of local importers, a much wider range of South African wines are now present on the Bulgarian market.

Tourism, too, has every reason to increase. Bulgaria offers affordable skiing for South Africans while in turn South Africa offers, among other attractions, safari options for Bulgarians.

A factor driving travel is that there are more than 20, 000 Bulgarians living in South Africa and a lot more could be achieved by easing visa arrangements and by arranging direct flights between the two countries.

Varna, Bulgaria's Black Sea capital is about to become the twin with Cape Town, South Africa's largest harbour and parliamentary capital. The parallels between the two cities are obvious: both are sea ports, both have naval bases, both are the second-largest cities of their countries and both are popular holiday destinations.

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