Ashra, the Israel Foreign Trade Risks insurance Corporation, published a warning today to exporters selling Israeli products to South Africa in the light of the upcoming elections in that country.
"The forthcoming elections in the country at the end of the month are liable to lead to harm to commercial relations between the two countries, in a way similar to the case of Turkey," the company states. The state-owned company calls on exporters to take steps accordingly, "to have their fingers on the pulse" and "to ensure that they are not over-exposed to customers in South Africa and that they are not already experiencing delays in payments due to them." The company adds that its insurance service will enable exporters to receive their money even in the case of a political event in which transfer of money to Israel is banned.
While Turkey announced this morning that it would temporarily approve the export of Turkish construction products to Israel, the fear now arises of complications in Israeli exports to South Africa. Israel’s trade with South Africa is much less valuable than trade with Turkey ($200 million exports and $150 million imports annually, compared with billions in trade with Turkey), but exports are concentrated in certain fields: industry, chemicals, and agriculture.
Elections are due to be held in South Africa on May 29, and the ruling African National Congress (ANC) party is liable to weaken considerably, and perhaps even lose power to the opposition. The latest polls suggest that the ANC will lose its absolute parliamentary majority, but will remain the largest single party, which is liable to cause political instability. "Various sources estimate that the hostile behavior of the South African government towards Israel, particularly the case brought against Israel in the International Court of Justice in The Hague alleging genocide in the Gaza Strip, stems from, among other things, the fear of this outcome, and the desire to divert attention from the economic and social situation in the country," Ashra states.
Published by Globes, Israel business news - en.globes.co.il - on May 9, 2024.
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