South Africa’s political transition from apartheid during the 1990s has served as a model across the world. Although the largest African economy (accounting for 1/3rd of Sub-Saharan Africa's GDP), South Africa still faces many development challenges, not least in fighting AIDS, poverty and high unemployment. South Africa is the EU's 13th largest trade partner, while the EU accounts for a third of South Africa's trade balance. Two-way trade amounted to €39 billion in 2010.
EU-South African relations have flourished since 1994, and both sides entered in May 2007 into a Strategic Partnership , the sole concluded by the EU with an African country. The Strategic Partnership has two strands: enhanced political dialogue and cooperation on regional, African and world issues, and stronger cooperation in a number of economic, social and other areas. The EU-South Africa political dialogue, which includes annual Summits and ministerial level meetings, has recently been focusing on issues of mutual interest such as peace and security in Africa, global governance or Climate Change. The Strategic Partnership has also given new impetus to cooperation and dialogue in a broad range of areas from the environment, energy, space, transport or migration to education and research.
South Africa and the EU signed a Trade, Development and Cooperation Agreement (TDCA) in October 1999 which entered fully into force on 1 May 2004. The TDCA covers political dialogue, the establishment of a free trade area over an asymmetrical twelve-year period, development co-operation, economic cooperation, and cooperation in a series of sectoral areas. A first amendment of the TDCA provisions on political and economic cooperation was signed in 2009. Scientific and technological cooperation is the subject of a separate agreementsigned in 1997.
South Africa, the EU and its Member States have drawn up a joint country strategy paper (CSP) guiding their development cooperation over the period 2007-13. Its main objective is to reduce poverty and inequality, while promoting social stability and environmental sustainability in South Africa. Programs focus on employment creation and capacity development for service delivery and social cohesion, with a total indicative budget for the seven-year period of €980 million.