What the Russian business told about the plans of work in South Africa

Russian companies are ready to participate in projects for the construction and modernization of energy capacities, the development of metallurgy and mining in the Republic of South Africa (South Africa), said the Minister of Natural Resources and Ecology of the Russian Federation Alexander Kozlov on October 27 at a joint meeting of business councils of the two countries, the correspondent of RBC. Business representatives also presented their proposals on expanding cooperation in the field of road construction and development of port infrastructure.

According to Viktor Vekselberg, Chairman of the Russian part of the Russia-South Africa Business Council, Chairman of the Board of Directors of Renova Group of Companies, the changing role of Russia in the emerging multipolar world and increased competition in Africa require a revision of approaches to cooperation with the countries of the continent. This involves developing new formats of interaction and building new relationships. Vekselberg expressed confidence that the meeting of the Business Council will allow to develop specific proposals for state and public organizations working, in particular, in South Africa.

What projects were discussed at the meeting

Among the possible areas of cooperation, Kozlov called the construction and modernization of energy capacities. According to him, Russian companies are ready to assist South Africa in solving energy problems.

Kozlov noted that energy is a component of sovereignty. According to him, the equipment wears out and requires repair, so it is important for the country to diversify suppliers. According to the minister, Russia can offer the competences accumulated over decades in the energy sector, including the supply of equipment and training of specialists.

The rise in the cost of electricity was one of the causes of the crisis in the production of ferrochrome in South Africa. A joint venture between Glencore and Merafe Resources to mine chrome ore has sought tariff reductions for a number of its plants. In May 2026, the South African regulator approved a tariff of 62 cents per kWh (about 54% below the level that was in effect at the end of 2025), after which Glencore-Merafe announced the abolition of the staff reduction procedure. According to Reuters, the cost of electricity in the country has increased by more than 900% since 2008. High energy costs have increased pressure on South Africa’s ferrochromic industry and contributed to the country’s loss of positions in the processing of chromium raw materials in favor of China.

What is known about the mineral resource base of South Africa

Kozlov called the study of lithium deposits a promising direction. According to him, South Africa is conducting research on various types of minerals, which can become the basis for future mining projects together with Russia.

In 2025, lithium was included in the South African Government’s Critical Minerals and Metals Strategy. In the document, it is classified as minerals with a medium degree of criticality along with copper, cobalt, nickel, graphite, titanium and other raw materials. The strategy provides for the expansion of geological exploration, attraction of investments and development of processing of critical minerals within the country.

South Africa itself is not one of the world’s largest lithium producers. According to the US Geological Survey (USGS), the country produces spodoumene, a mineral that serves as a raw material for lithium production.

The basis of the mineral resource base of South Africa are platinum group metals and chromium raw materials. The USGS estimates that in 2024, the country provided about 70% of the world’s platinum production, 46% of chromium, 40% of manganese (the largest producer of these metals) and 38% of palladium (the second largest in the world). South Africa was also the third largest producer of vanadium in the world. The USGS estimates the reserves of platinum group metals in the country at 63 thousand tons. One of the largest deposits of platinum group metals is Mogalakwena in Limpopo province.

According to USGS, in 2024, platinum production amounted to about 120 tons against 126 tons a year earlier, palladium - 70 tons against 82.6 tons. According to a review of the metals market of Norilsk Nickel (the world's largest palladium producer), in 2025 palladium production in South Africa amounted to 119 tons, platinum - 66 tons. The production of platinum group metals in the country decreased by 4% amid flooding of mines and years of underinvestment in the industry.

Russian Energy Projects

Russian companies already have experience in the South African renewable energy market. Igor Shahrai, General Director of Unigrin Energy, said at the meeting that the company has delivered products for one of the solar generation facilities in South Africa and is waiting for its launch.

Earlier, Unigrin Energy reported on the project of a solar park with a capacity of 115 MW in South Africa. Initially, the company planned to start construction in 2024 and commission the facility in the first quarter of 2025.

According to Shahrai, the company expects to participate in new competitions in the field of solar generation. Among the restrictions for Russian business, he called access to local financing and sanctions restrictions. At the same time, the cost of cross-border settlements can be so high, which leads to a decrease in the economic efficiency of projects.

Roads and logistics

The road construction company Avtoban also expects to expand its presence in South Africa. Its CEO Julia Strek said that the company has prepared and agreed with the South African Akani Properties Group a memorandum of intent on cooperation. The company is exploring the possibilities of implementing infrastructure projects in Africa, relying on the experience of building highways, bridges and transport infrastructure facilities, as well as implementing public-private partnership projects with the involvement of Russian financial institutions.

According to Strek, more than 3,000 km of roads are planned to be developed in South Africa. The company proposes to take into account construction services and investments in the formation of free trade agreements between Russia and South Africa. According to Strek, it is advisable to supplement intergovernmental agreements with a special industry protocol, which would provide for mutual recognition of qualifications and design experience of construction organizations, simplification of administrative procedures for the implementation of joint projects, as well as financial support mechanisms.

Among such mechanisms, Strek named settlements in national currencies, bank guarantees and instruments of the Russian Agency for Insurance of Export Credits and Investments (EXIAR). In addition, she proposed to study the possibility of participation of investors in public procurement procedures. According to Strek, such mechanisms are already being used in cooperation with a number of countries, including Vietnam, and can become a basis for work in new regions.

Negotiations on a free trade agreement between the EAEU and South Africa are still being worked out. Earlier, the EEC reported on the possibility of concluding free trade agreements with a number of countries, including South Africa.

Another limitation for the expansion of trade, the Council members called transport infrastructure. General Director of the FESCO transport group Petr Ivanov said that Russia’s share in the container turnover of South Africa is less than 1%. According to him, this makes it difficult to create a direct regular service between the countries.

In June 2025, FESCO launched a sea container service between Russia and the port of Durban in South Africa. Export shipments are organized from Novorossiysk and St. Petersburg through the Indian port of Nava Sheva, where containers are reloaded to feeder ships to Durban. When transporting from South Africa to Novorossiysk, the transit port of Jebel Ali to the UAE is also used, and cargoes to St. Petersburg go through the Indian port of Mundra. The first FESCO container with chemical products arrived from Novorossiysk to Durban on June 8, 2025, the transportation took about 45 days.

Now FESCO indicates on the website the approximate transit time on the route Durban - Novorossiysk about 40 days with the frequency of shipments twice a month.

Ivanov also reported a high load of the port infrastructure of South Africa, which reaches 90%. FESCO is interested in joint investments in the creation of new container terminals, which, according to it, will increase cargo turnover.

What and in what amount Russia and South Africa trade

According to the South African Statistical Service (SARS), the trade turnover between Russia and South Africa in 2025 increased by 6.2% compared to the previous year, to $ 907.8 million. Russian exports decreased by 6.2% to $524.3 million, while imports from South Africa increased by 29.7% to $383.5 million.

The basis of Russian exports to South Africa are fertilizers and grains. In 2025, the supply of fertilizers, mainly nitrogen, potash and complex, increased by 27.3% to $361 million. Supplies of cereals, mainly wheat, fell by 39.6% to $103.7 million. Exports of mineral fuels, oil and their distillation products decreased by 57.3% to $ 27.3 million.

Russian imports from South Africa are dominated by fruits and nuts. They were imported by $ 383.5 million, an increase of 56.3% compared to last year; the category accounted for 92% of the total volume of Russian imports from South Africa.