Wales's second day of action in Hong Kong began brightly with a 28-5 win over Spain, after leading 21-5 at halftime.
Kristian Phillips (2) and Alex Cuthbert scored first half tries with Rhys Jones adding three conversions with Spain's only response coming from Federico Negrillo.
With a number of substations disrupting the flow of the second half, Wales could muster only one more try through Adam Thomas which was converted by Gareth Davies.
South Africa was always going to be a different proposition and so it proved. South Africa seized control with Cecil Afrika running over in the second minute to give the favourites the perfect start. The new star of South African 7s added the conversion before Sibusiso Sithole touched down two minutes later. With Africa adding the extras Paul John's men were stearing down the barrel of a heavy defeat.
But the Welsh side managed to stem the flow, temporarily at least, when Newport Gwent Dragons centre Rhodri Gomer Davies hit back.
But all of Wales's hard work was undone when South Africa scored their third try of the first half when Paul Delport streaked over, Afrika once again knocking over the conversion to give South Africa a comfortable 21-5 lead.
If Wales had any chance of getting back into the game, they knew they had to hit the ground running in the second half. The Dragons managed to work Alex Cuthbert over to reduce the arrears and with Rhys Jones adding the conversion, Wales were just two scores behind.
But Delport scored his second of the match and from there it was one way traffic. Sithole scored his second with Tshotsho Mbovane driving the final nail into Wales coffin with a well worked try.