Singapore Eyes South Africa as Gateway to Africa-Asia Trade Growth

Singaporean Firms Deepen Trade Ties with South Africa as a Strategic Gateway to Asia

Singaporean companies are increasingly viewing South Africa as a strategic launchpad into Africa and a vital corridor connecting to Asia. This growing interest comes at a pivotal time, as South Africa intensifies its economic reform drive under Phase 2 of Operation Vulindlela, opening up key sectors like electricity, transport, water, and digital communications to public-private partnerships (PPPs).

According to Jean Ng, regional director for Southern Africa at Enterprise Singapore, the enthusiasm from Singaporean firms is not just symbolic. Logistics giants such as PSA International, which operates the world’s largest transshipment hub in Singapore, are eyeing long-term investment opportunities on the continent.

“They definitely are interested to land a flag in South Africa as a critical transport corridor,” said Ng in an interview with Business Report. PSA had previously submitted a bid to partner with Transnet to operate Durban’s Pier 2 terminal, a tender that was ultimately won by the Philippine-based ICTSI under a 25-year contract.

Transnet’s recent agreements, including a 10-year rail contract with United Manganese of Kalahari (UMK) and the long-term terminal deal with ICTSI signal a growing openness to foreign direct investment (FDI). These partnerships reflect a shift in the South African government’s approach, as State-Owned Enterprises like Transnet and Eskom are now allowed to collaborate more extensively with international partners.

Enterprise Singapore’s broader strategy is focused on expanding end-to-end logistics offerings across Africa, combining port operations with inland logistics to bring more value to customers on the ground.

“Singaporean companies are not just port operators anymore, they are looking at the full logistics and trade value chain,” said Ng.

A $20 Billion Investment Footprint in Africa

Singapore’s relationship with Africa is grounded in trade, technology, and long-term investment. According to UNCTAD, Singapore is now among the top 10 global investors in Africa, with more than $20 billion in foreign direct investment stock on the continent by the end of 2023.

In 2024, trade between Singapore and South Africa reached $1.4 billion, nearly doubling from 2020 levels—an indicator of intensifying bilateral economic ties.

Rahul Ghosh, director for the Middle East and Africa at Enterprise Singapore, described Africa as a “major diversification opportunity” for Singaporean businesses.

“Countries across Africa are moving away from being purely commodity-driven and are now building industrial capabilities,” said Ghosh. “This plays directly into the strengths of many Singaporean companies who are strong in logistics, digital infrastructure, and trade corridor development.”

A Two-Way Bridge for Global Trade Diversification

While Singapore sees Africa as a new frontier for outbound investment, the opportunity flows both ways. Ghosh stressed that African companies, particularly those in South Africa, should also look to Asia as a trade and investment partner in today’s shifting global order.

“With global supply chains being restructured and geopolitical uncertainty rising, Asia and Singapore provide a perfect bridge for African businesses looking to diversify their markets,” he said.

This evolving relationship comes at a crucial moment for both regions, offering the chance to build new digital and physical trade routes that go beyond traditional models—and connect Africa more deeply with fast-growing Asian markets.

{Source: IOL}

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