South African small and medium-sized enterprises (SMEs) have been encouraged to expand beyond domestic markets and take greater advantage of the opportunities created by regional trade agreements, despite ongoing challenges related to logistics, financing and cross-border regulations.
The call was made during the Second International Special Economic Zones (SEZs) Conference held in Durban, where government agencies, financial institutions and logistics experts discussed practical solutions to improve Africa’s trade environment and strengthen regional value chains.
Industry participants agreed that while Africa presents significant opportunities for business expansion, many SMEs remain hesitant to export due to the complexity of international trade requirements.
One of the biggest obstacles facing smaller businesses is understanding foreign market requirements. Exporters must comply with product standards, customs procedures, documentation requirements and country-specific regulations before goods can successfully enter international markets. For many SMEs, navigating these processes without specialised support can be both costly and time-consuming.
Logistics also remains a major challenge. High transport costs, limited export volumes and fragmented supply chains often reduce the competitiveness of smaller exporters. To address this, logistics providers are increasingly developing shared distribution models that allow multiple SMEs to consolidate shipments, reduce transport costs and improve access to overseas markets through central warehousing and coordinated distribution networks.
Despite South Africa’s advanced industrial base, experts noted that many local SMEs have been slower than businesses elsewhere on the continent to capitalise on the opportunities presented by the African Continental Free Trade Area (AfCFTA). Growing regional demand for manufactured goods, processed foods, consumer products and industrial supplies presents significant opportunities for businesses willing to expand beyond traditional markets.
Access to finance remains another critical barrier. Many emerging exporters struggle to secure the working capital needed to fulfil export orders, while stringent collateral requirements often prevent smaller businesses from accessing trade finance. Industry stakeholders believe that export credit guarantees, trade insurance and specialised financing products can help reduce these barriers and encourage greater participation in cross-border trade.
Financial institutions participating in the conference emphasised that funding is available for commercially viable export projects, provided businesses present well-structured investment plans supported by clear market opportunities. Development finance institutions also continue to play an important role in reducing investment risk and attracting additional private sector funding for strategic trade and infrastructure projects.
Special Economic Zones were highlighted as an important catalyst for export-led industrialisation by providing businesses with improved infrastructure, investment incentives and easier access to international markets. However, delegates stressed that SEZs can only reach their full potential if governments continue improving policy certainty, simplifying customs procedures and investing in efficient transport corridors.
As intra-African trade continues to expand, strengthening logistics, improving access to finance and reducing regulatory bottlenecks will be essential to enabling more South African SMEs to compete successfully across the continent. With the right support systems in place, smaller businesses are well positioned to become an increasingly important driver of Africa’s industrial growth, regional integration and export diversification.