The 2019 China Homelife Fair in South Africa was organized by the Wenzhou government. [Photo/zjol.com.cn]
China's AEO mutual recognition arrangement with South Africa's customs, which recently took effect, is expected to bring new development opportunities to Wenzhou enterprises which see the African country as an important trade market, according to an official from the Wenzhou customs.
AEO, or Authorized Economic Operator, is a system advocated by the World Customs Organization in which a customs authority certifies enterprises and allows them to undergo preferential custom clearances. This in turn reduces trading costs.
A number of enterprises in Wenzhou have maintained frequent trade contact with South Africa, with Tsingshan Holding Group, a stainless-steel manufacturer, being among them. The company's import of bulk commodities such as high carbon ferrochrome contributed to 45 percent of the city's total import-export volume in 2020.
"The implementation of the AEO mutual recognition between the two countries is expected to greatly reduce the cost of customs clearance for logistics from South Africa next year. At the same time, under the convenient customs clearance policy, our company's trade prospects with South Africa will be broader," said a director of the commerce department of Tsingshan Holding Group.
Statistics show that Tsingshan Holding Group has played a major role in Wenzhou's 1.9-billion-yuan ($298.11 million) trade with South Africa last year.
China has signed AEO mutual recognition arrangements with 47 countries or regions, including Singapore, South Korea and South Africa, as of November 2021. China's AEO mutual recognition with South Africa is the second such arrangement with an African nation following Uganda.
