BU S I N E S S DAY.CO. Z A
Business Day Insights TRADE FINANCE
Thursday 26 February 2026
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Opportunities in an evolving trade landscape R2-trillion in exports highlights SA’s global reach, writes Lynette Dicey South Africa’s trade landscape reflects both resilience and potential, with muted growth figures masking the substantial scale and opportunities inherent in the country’s import and export sectors. As global and regional markets evolve, a clear understanding of these dynamics is essential for businesses looking to strengthen their position in international trade. “Exports grew by 1.9% year on year in 2025 while imports expanded by 1.8%, but these numbers disguise the size of the sector, with exports over R2-trillion and imports above R1.8trillion — providing local importers and exporters with significant opportunities in global trade,” says Justin Milo, executive head of Trade and Working Capital for South Africa at Standard Bank. Key drivers on the export front include precious metals, agricultural commodities, animal products, prepared foodstuffs, timber products and vehicles — with regional growth seen in exports into Europe and Asia, while exports into the US and other African countries registered year-on-year declines. South Africa also registered a trade surplus of R200bn, with exports dominating imports — evidencing the extensive opportunities available to South African exporters
in international markets. Imports from the US and Asia grew, while imports from Africa and Europe declined. Key import growth drivers include vehicles, machinery and equipment, chemicals, prepared foodstuffs, textiles and Justin Milo. vegetable fats. The IMF estimates that world output is anticipated to grow by 3.3% year on year, while the South African economy is expected to deliver economic growth around 1.4% year on year. “The divergence in these growth dynamics suggests South Africa’s export growth is likely to outpace import growth on the back of trading partner growth,” says Milo. “Bearing in mind subSaharan Africa is expected to grow by 4.4% year on year this year, there is scope for an increase in local exports into the rest of Africa — especially manufactured products and finished goods.” He says recent appreciation of the rand and renewed optimism in the local economy due to improvements in electricity supply, stable economic growth, the country’s exit from the greylist and sovereign rating outlook improvements should provide support to imports as well. “Beyond the size and macroeconomic opportunities in the sector, exporters and
importers will need to carefully manage the risks and market challenges they face to monetise trade opportunities,” says Milo. “Key risks and challenges faced by counterparties in international trade include exchange rate volatility, a lack of efficient transport infrastructure, foreign currency liquidity challenges, geopolitical challenges, tariffs and nontariff barriers and supply chain disruption.” The most significant risk faced by South African exporters, he says, is payment risk — the risk that the importer does not fulfil their payment obligation to the exporter. “Payment risk is elevated when exporting into markets with foreign currency liquidity challenges, exporting to new customers with an unknown payment track record and, importantly, when exporting on open account terms without the security of a trade finance instrument such as a letter of credit or payment guarantee. Key counterparty markets where payment risk mitigation is increasingly sought by local corporates and global multinationals include Kenya, Nigeria, Egypt Ethiopia, Tanzania and Ghana.” Local exporters with aspirations of exporting into the rest of the African continent and other new markets need insights into those markets. They also require trade finance solutions to assist with the mitigation of payment risk and working capital solutions to provide cash flow support to facilitate performance under export contracts. “As the largest bank in Africa by assets, Standard Bank is well placed to assist exporters through on-the-ground expertise across 20
markets in Africa, leveraging expert trade finance structuring teams and a suite of trade finance solutions to mitigate payment risk and support the cash flow needs of exporters,” says Milo. While importers look to manage performance risk, a growing need is working capital funding to support procurement and cash flow. “These needs are the result of increased demand due to growing economic output, counterparty risk and payment term shifts, supply chain disruption and reconfiguration, exchange rate and commodity price volatility and foreign currency liquidity challenges,” says Milo. Working capital funding, he explains, can be tailored specifically to import flows via a suite of import financing solutions and, domestically, for local procurement and operating expenditure. “Standard Bank provides a range of working capital financing solutions, supply chain finance and structured trade and commodity finance solutions to meet a variety of needs — from cash flow enhancement to working capital optimisation and supply chain continuity,” says Milo. In an increasingly interconnected global economy, there are opportunities for local importers and exporters across regions and sectors. “These opportunities, however, are not without risks, particularly related to payment, performance and working capital pressures. Mitigating these risks requires leveraging informed insights and partnering with institutions equipped with deep market expertise and robust trade finance capabilities,” he says.
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