European Commission President Ursula von der Leyen led a high-level delegation in Cape Town on Thursday for the eighth EU-South Africa summit, where the bloc unveiled a €4.7 billion ($5.1 billion) Global Gateway investment package. The package is aimed at supporting South Africa’s energy transition, vaccine production, and digital and physical infrastructure.
The summit marked a crucial moment in EU-South Africa relations, particularly as the country faces increasing economic uncertainty due to a freeze in U.S. foreign aid under President Donald Trump. The United States, once a key development partner, has cut funding for South African health programs, including crucial HIV treatment and research initiatives.
A Critical Economic Partnership
South Africa remains the EU’s largest trading partner in sub-Saharan Africa, with trade in goods reaching €49 billion in 2023. The EU has also overtaken the U.S. as South Africa’s top source of foreign direct investment (FDI), contributing 53.7% of total FDI in 2022.
Von der Leyen emphasized that economic cooperation is key to the relationship, stating that the Global Gateway initiative will help South Africa’s green transition while also ensuring stability in supply chains.
“This is a partnership based on shared values and common interests,” South African President Cyril Ramaphosa said at the summit. “It seeks to create prosperity for our citizens and promote peace, safety, and stability.”
According to Ramaphosa, the EU’s investment package will enhance collaboration in science and technology, climate action, security, health, and critical minerals.
South Africa’s Growing Distance from the U.S.
The shift toward closer ties with the EU comes as relations between South Africa and the U.S. have deteriorated. Trump’s administration recently cut aid to South Africa, citing geopolitical tensions, particularly South Africa’s accusations of genocide against Israel at the International Court of Justice.
Ivor Ichikowitz, founder of the Ichikowitz Family Foundation, which focuses on African development, believes the EU’s increasing investment is timely.
“There has never been a time when South Africa needs the European Union more than right now,” he told RFI. “The breakdown in the relationship between South Africa and the U.S. poses a massive threat to the South African economy.”
A Test of South Africa’s Neutrality
While South Africa strengthens its ties with Europe, the EU is also seeking broader global support for Ukraine amid Russia’s ongoing war. With South Africa historically perceived as aligned with Russia, some European leaders hope closer economic ties will encourage a more neutral foreign policy stance.
Ichikowitz suggested that the new EU partnership might push Ramaphosa to maintain a more balanced diplomatic approach.
“South Africa has been identified as an ally of Russia and against the West, but in reality, the government claims to be neutral,” he said. “Now, it must start walking the talk of neutrality.”
As the geopolitical landscape shifts, the EU-South Africa summit signals a deepening strategic alliance, offering South Africa an alternative economic partner amid strained relations with the U.S.