China and South Africa have enjoyed smooth bilateral relations since the establishment of formal diplomatic ties in 1998. The formalized relations in part assisted the significant growth in trade between these two regional leaders. In 2005 China exported $4.4 billion worth of goods (dominated by electronic equipment and textiles) to South Africa while it imported $1.3 billion worth of goods (dominated by raw materials) from South Africa, according to South African Revenue Service figures. Official statistics from the Chinese Statistical Bureau paint a rosier picture, however, with Chinese exports to South Africa standing at $3.8 billion while importing $3.4 billion in value from Africa's largest economy.

Investment between the two countries has also been robust, although South Africans have been more active in investing in China than the other way round. Whereas China's investments on the rest of the continent are heavily slanted towards raw materials, its involvement in South Africa has been more diverse. A trailblazer in the field of Chinese investment in South Africa was Hisense, the consumer electronics giant that entered into a TV-set assembly joint venture in 1996. Shanghai Guangdian followed with a similar arrangement for black & white TV's, while a few smaller players have entered the electronics manufacturing market. In 1997 the China Iron and Steel Corporation (Sinosteel) paid $74 million for a 60 percent stake in a ferrochrome investment in the northern province of Limpopo, while in 2002 Jinchuan Iron & Steel Corporation (JISCO) paid $34 million for a share in another ferrochrome development in the north of the country. More recently, in 2004, Chinese industrial giant CITIC led a consortium that built a coking coal plant at a Mittal steel plant in KwaZulu Natal province. To date, the largest Chinese vote of confidence in the South African economy, however, was cast outside the country, when CITIC Chairman Larry Yung Chi-kin paid $800 million for a 1.5 percent stake in London-listed Anglo American, a multinational resource player that draws around a third of its revenue from its South African mining operations.

From the South African side, the mid-to-late 1990's saw a flurry of Chinese-bound activity as South Africa's newly democratic government made it possible for South African firms to venture overseas. The initial years of contact between the two countries were dominated by decidedly blue chip firms, with South African Breweries (now SABMiller) entering the fray in 1994, following on the heels of Iscor's (now Exxaro) first sale of iron ore to China in 1989. To date, the South African companies discussed below are believed to have invested at least $500 million in China.

Chemical & Petroleum

Sasol

Sasol began planning with Shenhua Group Co Ltd and Shenhua Ningxia (http://www.chinadaily.com.cn/bizchina/local_ningxia.html) Coal Ltd for two Coal-to-Liquid (CTL) projects in 2004. It finished preliminary studies at the end of 2005 and established a representative office in Beijing in 2006. Sasol's two projects, one in Yulin, Northwest China's Shaanxi (http://www.chinadaily.com.cn/ bizchina/local_shaanxi.html) Province and another in the Ningxia Hui Autonomous Region, are designed to produce 80,000 barrels of liquid fuel per day and represent the company's largest investment outside of South Africa. Each plant is expected to cost $5 billion to $6 billion. Operations are expected to start by about 2013.

Construction

Landpac Road Construction Technology Development Company

Landpac, through employment of its cutting-edge patented technology, has been operating in China for many years. Its projects include compaction of roads, road rehabilitation, airport projects and dam rockfills. Its representative office is based in Beijing but projects have extended to the majority of China's provinces and autonomous zones.

LRPS China Ltd

LRPS is a South African-led consortium that has invested in the construction of a real estate project in Ningxia Hui Autonomous Region's capital, Yinchuan. The multi-billion renminbi project is the largest and most up-market of its kind in Ningxia that includes luxury apartments and villas.

FMCG

SABMiller

SABMiller through its joint venture with China Resource Enterprise owns China Resource Snow Breweries Limited, which replaced Qingdao Beer in terms of volume and revenue as the biggest selling national beer in China with a 15 percent market share. China Resources Snow Breweries Limited was established in 1993. SABMiller's breweries cover 12 of China's provinces. SABMiller plc is one of the world's largest brewers with brewing interests or distribution agreements in over 60 countries across five continents. Outside the USA, SABMiller plc is also one of the largest bottlers of Coca-Cola products in the world, and is listed on the London and Johannesburg stock exchanges.

Media

MIH

MIH is Africa's largest media company that has interests in Electronic Media (Pay TV and the Internet) and Print Media (Newspapers, Magazines, Printing, Books and Education). MIH began cooperation with China back in 1997, when an agreement was signed with CCTV4 to transmit it to Africa and Europe. In 1998 MIH established a representative office in Beijing. In the same year, it was also awarded the contract to implement the Village to Village Project, delivering TV and Radio programming to remote areas of China via satellite. Through their representative office in Beijing, MIH utilizes its intellectual property owned Irdeto technology, a world leader in content security. Irdeto is essential for cable TV, IPTV and mobile TV industries to protect their valuable content from theft and ensure that viewers pay for the channels they receive. Based on its extensive sport broadcast experience, MIH is also a technical advisor of CCTV in preparation for the 2008 Olympics.