The R1 trillion trade opportunity for South African SMEs

In the wake of South Africa's successful hosting of the G20 Summit, a palpable sense of opportunity is alive across the continent.

Global partners have lauded the nation's diplomatic prowess and meticulous coordination during the summit, paving the way for a heightened focus on Africa's growth and development.

As President Cyril Ramaphosa noted in his address, this historic moment serves as a catalyst for entrepreneurs seeking to scale their businesses beyond domestic borders.

Independent media coverage from the G20 highlighted South Africa's ability to create a welcoming atmosphere that impressed world leaders and international media alike.

With a new-found confidence in Africa's potential, South African small and medium enterprises (SMEs) are now presented with the pivotal chance to tap into what could be a R1 trillion export opportunity, according to a study by the MISTRA in conjunction with Takealot.

The E Commerce Forum of South Africa recently revealed that the country's online retail sector was set to grow to R130 billion by the end of 2025.

This rapid escalation—from a mere 1% to nearly 10% of retail in just five years—indicates a robust shift towards digital adoption.

The integration of the African Continental Free Trade Area (AfCFTA) further amplifies this opportunity, wherein local SMEs can connect with continental ecommerce channels and ensure greater access to new markets.

“Many SMEs still underestimate the scale of potential waiting across the continent,” according to Luncedo Mtwentwe, Managing Director at Vantage Advisory.

He encourages local businesses to consider the vast landscapes of opportunity that neighbouring markets present.

“Those ready to scale and innovate can reap continent-wide rewards,” he asserts, stressing the critical need for South African SMEs to broaden their horizons beyond traditional markets like the US and EU.

With nations like Nigeria, Kenya, and Ghana exhibiting strong economic gains fuelled by rising consumer spending and a youth-driven demographic, the conditions are ripe for South African SMEs willing to embrace this wave of expansion.

For example, Yaga, an online marketplace for second-hand fashion, recently announced its entry into the Kenyan and Nigerian markets, while SweepSouth broke ground in Nigeria in 2018 by leveraging digital infrastructure and local expertise.

Mtwentwe notes the urgency of seizing these opportunities in the post-G20 environment. With the impending expiry of the African Growth and Opportunity Act on 30 September 2025, South African businesses are being called to redirect their focus towards intra-continental trade.

Key aspects to consider include understanding the efficiencies gained through AfCFTA’s harmonised customs processes, digital platform integration, and the power of strategic local partnerships.

He offers a blueprint for SMEs aspiring to venture into African markets:

• Leverage AfCFTA advantages: Understand how tariff reductions and simplified customs processes can enhance competitiveness.
• Digitalise sales and distribution: Transition to e-commerce and mobile payment systems to reach a broader customer base.
• Identify high-growth markets: Target rapidly developing economies with growing middle classes and rising demand.
• Form local partnerships: Collaborate with local distributors familiar with the specific market dynamics.
• Start small, scale strategically: Initiate your market entry through pilot projects before launching broader expansions.

Although global economic uncertainties linger, Africa’s unique integration and its burgeoning demographic landscape signify one of the most substantial growth prospects for South African entrepreneurs in recent years.

As Mtwentwe succinctly puts it, “The journey won’t always be easy, but the rewards are enormous for those ready to lead, innovate, and make their mark across the continent.”

This is South Africa’s moment to take the momentum from the G20 Summit and secure real economic participation through SME-driven growth, setting the stage for a brighter, more interconnected future.

BUSINESS REPORT