High import tariffs, trade barriers and a culture of protectionism impedes economic growth, says Department of Trade and Industry Director General Tshediso Matona.
Speaking at the South Africa - Nigeria Business Forum on Monday, Mr Motana appealed to his Nigerian counterparts that protectionism, trade barriers and high import tariffs act as obstacles for trade and investment.
"While we encourage the development of industries through certain targeted subsidies and support from government, generalised high levels of protection we have found is a barrier to growth," said the Director General, speaking on behalf of Minister of Trade and Industry Mandisi Mpahlwa.
The minister is currently concluding World Trade Organisation talks in Geneva, Switzerland.
There is political good will between South Africa and Nigeria, said Mr Matona, adding that both countries need to fully utilise the situation to exploit the abundant trade and investment opportunities.
"Trade and investment between South Africa and Nigeria has been growing at a phenomenal rate but we're only starting to scratch the surface.
"Our imports are dominated by oil, but we would like to help Nigeria's economy to diversify their exports to South Africa.
"Unbalanced trade between African states is a known trend that needs to change, as inter-Africa trade is a mere 10 percent of continental trade. The average inter-Africa trade between 1996 and 2005 was 9.6 percent of total trade."
Mr Matona said his department looked forward to working with Nigerian business to open up trade opportunities and allow investment to grow between the two countries.
According to the department, the forum is being held to strengthen economic ties and cooperation between the two countries by providing the necessary platform for information and knowledge-sharing, and the exploration of future collaborative business ventures.
Business sectors represented at the conference include oil and gas; Information Communication Technology (ICT); tourism; infrastructure development; financial services; aviation; agriculture; and power services.
Nigeria presents immense economic growth opportunities for South African exports.
Chiefly regarded as West Africa's economic giant, contributing over 55 percent of the region's Gross Domestic Product [GDP], Nigeria presents investment opportunities in different sectors of the economy, according to the department.
The trade relationship between Nigeria and South Africa has enjoyed substantial growth between 1999 and 2007 [growing] to almost R11 billion in 2007, attributable to an increase in the demand for energy resources in South Africa.
Crude oil constitutes 98 percent of South African imports from Nigeria, said the department.
In 1999, only four South African companies operated in Nigeria. However, there are now over 100 companies doing business in Nigeria in almost all sectors of the Nigerian economy. - BuaNews