South African president Nelson Mandela undertook a state visit to Ottawa and Toronto in the fall of 1998. In his address to a joint sitting of Parliament, Mandela thanked Canada for “helping us end our oppression; for assisting us through our transition; and, now, for your partnership in the building of a better life for all South Africans.”
That sense of partnership was reflected in a Trade and Investment Cooperation Agreement (TICA) signed during Mandela’s visit, which identified specific actions to be taken to enhance economic ties between Canada and South Africa. Yet, twenty years later, our countries still haven’t realized the full potential of their bilateral relationship.
It is decidedly in our shared interests to revitalize the partnership which Mandela spoke about so forcefully during his trips to Canada, and the timing couldn’t be more fitting. This month, April 2019, marks the 25th anniversary of the historic election which completed Mandela’s long walk to freedom — from prisoner to president.
How, then, should we go about it? A traditional first step would be to sign a foreign investment promotion and protection agreement (FIPA), also known as a bilateral investment treaty. In fact, the 1998 TICA signed by Canada and South Africa committed both countries to the “finalization and implementation” of such an arrangement.
For its part, Canada has or is in the process of concluding FIPAs with several African countries including Nigeria, Egypt, Kenya, Tanzania, Ghana, the Democratic Republic of the Congo, Côte d’Ivoire, Tunisia and Cameroon. South Africa, however, moved away from bilateral investment treaties in 2012 under president Jacob Zuma.
If a foreign investment agreement isn’t on offer, a free-trade agreement is the best option — and here the timing is similarly advantageous. South Africa is the largest market in the soon-to-be ratified African Continental Free Trade Agreement (AfCFTA), a comprehensive pact designed to expedite the integration of Africa’s economies.
The AfCFTA has been signed by 52 of 55 African countries — with only Nigeria, Benin and Eritrea yet to do so — creating the world’s largest free-trade zone area. As of this writing, at least 22 of the signatory countries have completed a domestic ratification process, which is a critical threshold required for the agreement to be implemented.
Canada does not currently have a free-trade agreement with any African country, and the closest it has come are some early stage negotiations for a bilateral deal with Morocco. If Canada could now secure preferential access to virtually every African market at the same time, the mutually beneficial economic impact would be massive.
It is projected that the combined AfCFTA countries would represent an integrated market of more than 1.2 billion people and a collective GDP of more than $2.5 trillion (U.S.). To put those figures in context, India has 1.3 billion people and nominal GDP of $2.6 trillion — and Canada has actively pursued free trade with it since 2010.
If South African President Cyril Ramaphosa achieves his goals for economic growth, his country’s GDP could equal 18 per cent or more of the AfCFTA total. That is simply one reason why South Africa is the logical strategic partner for Canada within the African Union — not that Canada should neglect the likes of Egypt, Ghana or Morocco.
What’s in it for South Africa? Canada is a mature trillion-dollar market, and the only G7 country with preferential access to the six other G7 members. It is a gateway to markets in Asia, Europe and the Americas, with solid relationships throughout the African continent thanks to its ties to both the Commonwealth and la Francophonie.
Moreover, Canada has repeatedly demonstrated it has the increasingly rare capacity to successfully conclude complex multilateral free trade negotiations such as the Canada-European Union Comprehensive Economic and Trade Agreement, the Trans-Pacific Partnership, and, most recently, the Canada-United States-Mexico Agreement.
During his third and final visit to Canada in November 2001, Nelson Mandela remarked that South Africa “could always turn to Canada.” It was true then, and it remains true today. But, as the world prepares to commemorate the anniversary of one of Mandela’s greatest achievements, the time is right for Canada to turn to South Africa.