CHRIS HATTINGH: SA needs to make the most of its G20 presidency

When SA assumes the presidency of the Group of 20 (G20) on December 1, it gains a position that will afford the country, and the government of national unity, numerous economic, investment, trade, diplomatic and strategic opportunities.

The scale of the opportunity is best perceived against the reasonable assessment that attaining the above-3% GDP growth target by 2025, set by the government and business, will, among other things, require attracting significantly higher levels of fixed investment and gross fixed capital formation — particularly from abroad. As a percentage of GDP, the latter reached a high point of 21.6% around 2008/09, but has remained at 10%-15% for all years since. The National Development Plan’s 2030 target is 30%.

With geopolitical tension and uncertainties increasing steadily worldwide, and with both China and the EU facing serious growth challenges over the short-to-medium term, SA has before it an immense opportunity not only for domestic reforms that would encourage capital formation and job creation, but also to be one of (if not the) leading actor in an accelerated implementation of the African Continental Free Trade Area.

However, attaining these potentially positive outcomes, with the G20 presidency and 2025 summit in Johannesburg bolstering every opportunity to work towards them, presumes that the government will play its diplomatic and geopolitical hands well. Unfortunately, evidence of this has yet to be seen.

A case in point is Pretoria’s conduct in Southeast Asia. While it does not carry the same label as an “embassy” would, the Taipei liaison office in SA has served as Taiwan’s de facto embassy since 1998. Recent media reports indicated that the SA government had “insisted” Taiwan move the liaison office out of Pretoria by the end of October.

It is not clear whether the government is acting under pressure exerted by the People’s Republic of China, though this has been widely claimed. Subsequent reporting has suggested that approaches by countries with cordial relations with Taiwan and extensive interests in SA — such as Japan — have been rebuffed by the SA government.

Strategically and economically, SA stands to gain very little from this move, but would be risking much both technologically and diplomatically if it were to go ahead with it. While it is a risk that is by no means to be dismissed, Chinese demand for SA exports (especially commodities) will not be summarily suspended should the government not force this move against Taiwan.

However, the damage to SA’s diplomatic and geopolitical standing could prove to be substantial. The liaison office, its history and location mean more to Taiwan than the occupation of its present accommodation would mean to China.

For Taiwan, under mounting economic and diplomatic pressure by China, SA’s acceptance of the office in its current location would send a principled, and precedent-setting, signal. For other current and potential allies of SA, such a move would also indicate that the government takes its foreign policy and geopolitical commitments seriously. Equally pertinently, it would indicate that SA has a genuine commitment to its “non-aligned” positioning.

With global tensions rising — not least in the Taiwan Strait — very sober assessments of the consequences of Pretoria’s diplomatic choices are called for. Despite the SA government’s at times outsized significance on the global stage, there is as yet little reason to believe that it has a clear understanding of the concerns of many quite different countries with which it has relations.

Too often, it seems to default to a dogmatic form of ideological and geopolitical thinking. This is unconducive to productive and economically fruitful relationships with partners of all stripes.

It’s one thing to talk about “non-alignment”, but as SA navigates more tension-filled geopolitics, practising such behaviour is another matter entirely. Likewise, the country’s oft-stated (but not necessarily always supported by action) enthusiasm for multilateral institutions requires a degree of understanding of its interlocutors and their interests — and how these intersect with those of others — that it does not always demonstrate.

With global trade and diplomatic relations in greater flux than they have been for a generation, those countries that practise what they preach will benefit in terms of increased international appeal and reliability. The span of SA’s G20 presidency is one such (possibly generational) opportunity.

• Hattingh is executive director of the Centre for Risk Analysis.