South Africa is looking for expanded trade and investment to meet its development needs by improving roads, communications and power and by generating more manufacturing jobs, Zuma told a forum of business executives from China and South Africa.

"China is indeed a key strategic partner for South Africa, and South Africa is open for business in a big way," he said, on the first full day of a three-day trip to China.

"We envisage meaningful future cooperation in infrastructure, the benefaction of minerals, engineering, energy, information and communications technology and electronics. There are also opportunities to be explored in manufacturing."

The South African leader's comments underscored the attractiveness of China for African countries, while hinting at the frustrations of African governments and companies that want to see more Chinese investment and orders spreading beyond mines and resources.

For Beijing, Zuma's visit is an opportunity to consolidate ties with African countries, where China is increasingly turning for resources, markets and diplomatic support. Late last year, Chinese Premier Wen Jiabao offered Africa $10 billion in concessional loans over three years.

Zuma was accompanied by a delegation of more than 370 business representatives -- the biggest ever for a South African leader's visit abroad, said officials.

Chinese and South African executives signed a dozen deals and memorandums of understanding about investments in energy, power transmission and railways.

The deals included a 240 million euro ($303.6 million) loan agreement between South Africa's third-largest mobile phone operator, Cell C, and China Development Bank.

Later in the day, Zuma and Chinese President Hu Jintao signed a broad pact vowing to enhance ties and then watched as officials from the two nations signed agreements on cooperation in mining and energy, railways and environmental protection.

With GDP growth forecast at 2.3 percent this year, South Africa stacks up unfavorably against China, and Zuma is looking to narrow his country's trade deficit with Beijing.

Underscoring the broader challenges of doing business in South Africa, more than 1 million public sector workers launched a strike last week, the latest in a wave of labor protests to hit the country since May.

China is South Africa's largest trading partner, but last year South Africa ran a $2.7 billion trade deficit with China, according to South African statistics.

"We all agree that in South Africa's export market to China there is a preponderance of primary products, and in our imports from China there is a preponderance of value-added goods," South African Trade Minister Rob Davies told a news briefing.

"We want to work together with China to try to address that so we have a more equitable balance of trade," he said.

In the first six months of 2010, trade between the two countries reached $10.8 billion in value, a jump of 56.1 percent compared with the same time last year, according to Chinese statistics.

GDP growth slows

South Africa's economic growth slowed more than expected in the second quarter of 2010 as mining contracted while expansion in manufacturing was lower than before, backing the case for another interest rate cut.

Statistics South Africa said the economy grew by 3.2 percent in Q2 on a seasonally adjusted and annualized basis compared to 4.6 percent rise in Q1 and below the median forecast of 3.6 percent from a Reuters poll of 16 economists last week.

The economy expanded by 3.0 percent year-on-year unadjusted, compared to 1.6 percent in the first quarter of 2010, against predictions of a 3.1 percent rise.

Both the central bank and the National Treasury had predicted a moderation in Q2 growth and Finance Minister Pravin Gordhan said last week risks for global growth had risen sharply and that this, coupled with increased turbulence in financial markets, would see growth of at least 3 percent in Q2.

"I think (the quarter-on-quarter number) is a bit disappointing. It does suggest that there has been some loss of momentum in the economy," said Nedbank chief economist Dennis Dykes.

He said this could prompt the Reserve Bank to cut rates further, adding to 550 basis points of reductions between December 2008 and March this year.

"The rand is still very strong and inflation has been coming in under expectations, (this) probably all adds to arguments that they could ease once again in September," Dykes said.