South Africa’s manufacturers are facing renewed pressure as Chinese exports surge, adding to the challenges confronting an industrial sector that has been in decline for more than three decades.
The shift comes as US President Donald Trump’s tariff policies reshape global trade flows, prompting Chinese producers to seek customers beyond markets where trade barriers have increased.
China’s exports to South Africa rose by almost R165 billion in the first eight months of 2026 compared with the same period in 2020, according to the figures cited in the original report. Shipments increased by 29% year-on-year, highlighting the pace at which trade between the two countries is changing.
For local manufacturers, the concern is not simply the volume of imported goods, but their ability to compete on price while dealing with high operating costs and weak domestic demand.
Local manufacturers struggle to compete
South Africa’s trade relationship with China reflects a significant imbalance in its manufacturing supply chain. Central bank data cited in the report shows that China accounts for more than a third of South Africa’s manufacturing imports, but only around 5.9% of its exports.
Moody’s Ratings has identified South Africa as the most exposed to Chinese trade competition among eight African economies assessed in its latest Manufacturing Vulnerability Index. The assessment points to the country’s sizeable manufacturing sector, reliance on foreign inputs and declining competitiveness.
Local producers are also dealing with expensive energy, infrastructure failures, regulatory burdens and a labour market that businesses consider difficult to navigate. These pressures make it harder for South African factories to match prices offered by international competitors.
The effects are already being felt by individual businesses. Alvern Cables, a Germiston-based manufacturer established in 1967, produces low- and medium-voltage cables for homes, factories and infrastructure projects.
Works director Jaycen Padiachy said the company had expected the recovery in economic activity following the Covid-19 pandemic to support demand. Instead, stronger competition from imports has affected its operations.
Padiachy said the business had adjusted its operating model and temporarily reduced working hours in response to market conditions.
The pressure extends across several industries. South Africa’s International Trade Administration Commission (ITAC) is investigating five new applications seeking relief from rising imports. The cases cover products including gypsum plasterboard, polyethylene terephthalate plastic used in beverage packaging, cold-rolled steel and steel fasteners.
ITAC said import-related cases had generally increased over the years, with some of the rise linked to imports from East Asia, including China.
Government faces calls for a clearer trade policy
Business Leadership South Africa head Busi Mavuso has criticised the government’s approach, arguing that stronger protection for local industry has not matched its stated commitment to industrialisation and value addition.
She also raised concerns about the absence of a clear national trade policy, saying political considerations should not take precedence over economic needs.
The trade department, however, says it recognises the scale of the challenge. Acting deputy director-general Maoto Molefane described the upheaval in global trade as a serious wake-up call and said South Africa needed to reduce its dependence on particular regions.
The government is promoting a “butterfly strategy” intended to expand trade links across different markets and encourage businesses to diversify their export destinations.
Yet the difficulties facing manufacturers go beyond imports. Factory capacity utilisation stood at about 76% in 2026, compared with 83.2% in 2003. The figures suggest that South Africa retains manufacturing capacity but is not using it fully.
Weak demand is a central part of the problem. Businesses need sufficient orders to justify investment in production, while consumers under pressure from unemployment and living costs are often drawn to cheaper alternatives.
Nedbank senior manufacturing manager Sello Takatso said the country still had the ability and capacity to manufacture goods, but growing import competition meant local producers increasingly had to compete on price.
For South Africa, the challenge is therefore twofold: responding to changing global trade flows while addressing the domestic costs and structural weaknesses that make local production less competitive. Trade measures may offer relief to particular industries, but a sustained recovery will also depend on stronger demand, reliable infrastructure and a more competitive manufacturing environment.