DIPLOMATIC DECISION
Bilateral ties with Israel benefit SA more than mere numbers suggest
ANC would be wise to mull over deeper implications of downgrading relationship with Middle Eastern country, writes Peter Draper
At its fifth national policy conference on July 4 2017, the ANC considered a proposal by its Western Cape region to either sever ties with Israel or downgrade the South African embassy in Tel Aviv. A recommendation was made that the party take a final decision on the matter at December’s elective conference. Consequently, SA’s bilateral relations with Israel may be about to enter uncharted territory, with the looming possibility of a serious rupture in trade and investment. Against this backdrop, we were commissioned to consider the potential contours of such a rupture. We considered four key impact channels that are likely to have first-round and second-round economic effects: trade, investment, technology and tourism. We viewed these channels through relative and absolute lenses. Relative to their total trade, trade between the two countries is small. In SA’s case, the highest level since 2000 was 2.21%, recorded in 2002. The same is true of two-way investment flows, with Israel’s...
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