Mrs May is in South Africa with a trade delegation and has announced what the media are calling Britain's first post-Brexit trade pact (HERE). However, a few things to bring us back to earth. First of all, what she is announcing is the continuation of the EU's existing trade deal with SACU - the South African Customs Union. In other words we will lose about 40 FTAs and this is getting one back and not one of the big ones either. The PM wants post-Brexit Britain to be the largest investor in Africa in the G7.
Secondly, we shouldn't overlook the fact that talks began in July 2017 (HERE) and it has taken more than a year to get to this stage. Using Peter Lilley's suggestion that a trade deal with the EU should take no more than ten minutes, this one should have taken about ten seconds - but it didn't.
And finally, there are varying statistics for the amount of trade involved but it isn't very large. ITV show a graphic from the ONS putting trade with South Africa at £4.7 billion. The Independent (HERE) suggests exports are worth about £3 billion.
South Africa alone (not including the other SACU territories) has exports and imports to EU countries (HERE) given in Rand, (£1= 18 Rand) and it seems we are the EU's second largest trading partner for South Africa. The largest (as always) is Germany which has several car plants in SA importing parts and exporting RHD models back to Europe.
But being the second largest exporter to South Africa actually means we ship goods and services about £2 billion a year. By comparison Germany ships about £7 billion, around 250% more than we do.
The trade deal is being hailed as a great success but we are leaving a bloc that takes about £300 billion a year in exports from the UK (plus the free trade deals the EU has at the moment) in order to start "investing" in South Africa - something we could have done perfectly well inside the EU. The SACU trade deal is a very small step on the long road to putting us back to where we are now. Mad isn't it?
