Understanding and characterizing South Africa's services sector exports

This paper examines the performance and composition of South Africa’s services exports and use economic complexity and relatedness metrics to identify future services export diversification opportunities. South Africa’s services exports have underperformed in relation to global and domestic trends, which is consistent with the sector not being able to take advantage of the rising tradability of services. The country’s services exports basket is oriented towards low-complexity traditional services, particularly personal and business travel services, and primarily services-developed economies. Taking into account services sector exports reveals South Africa’s economic structure to be more complex than looking only at goods exports. Modern, and several traditional, services activities are shown to have similar complexity levels to manufacturing products, which suggests that diversification towards such tradable services has the potential to drive future economic growth. We identify future export diversification opportunities, including modern services exports such as professional and management consulting services and computer services; and traditional services exports such as courier services, technical, trade-related, and other business services, and manufacturing services.