Theresa May. Picture: REUTERS
Theresa May. Picture: REUTERS

UK Prime Minister Theresa May touched down in Cape Town on Tuesday, as she begins a three-country African tour.

She will hold discussions on Tuesday with President Cyril Ramaphosa amid deepening uncertainty over the UK’s divorce from the EU and implications for trading partners.

The UK is SA’s sixth-largest global trading partner, accounting in 2017 for R79.5bn in trade.

Trudi Hartzenberg, executive director at the Trade Law Centre, said: "The smooth continuing of this trade relationship [after] Brexit really does matter."

The UK is also an important investment partner.

Last year foreign direct investment from the UK surpassed all other countries and accounted for 38% in SA, amid slowing foreign direct investment into SA, according to Standard Bank research.

The UK is a key source of tourism to SA, with nearly 448,000 British citizens visiting in 2017.

May will also visit Kenya and Nigeria and is travelling with a contingent of government ministers and officials and 29 business representatives, according to the UK government.

"This delegation of business leaders … will no doubt have questions about investment security with regards to expropriation of land without compensation changes and the protection of foreign investors," Catherine Grant Makokera, a director at Tutwa Consulting Group, said.

"The UK is looking to rebuild relationships with some of the old Commonwealth partners, including SA, in a bid to retain their relevance once they are outside of the EU … [those] bigger geopolitical issues will be something that we might see Theresa May try to emphasise," she said.

Uncertainty clouds Brexit and its implications for SA and its neighbours.

"Post-Brexit scenarios depend very much on whether the UK stays in the EU customs union," Hartzenberg said. If it stays, the trade-in-goods governance regime with Southern African Development Community countries will not change. If it leaves, new agreements will have to be negotiated.

For example, grapes entering the EU via Rotterdam, with part of the consignment bound for the UK, could have implications for rules of origin and standards with associated documentation requirements and border checks as they move from the Netherlands to the UK.

UK trade officials are negotiating with SA and other members of the Southern African Customs Union on a transitional arrangement after March 29.

With Claire Bisseker

speckmana@businesslive.co.za

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