Several key events took place during 2016 that may collectively result in a turning point for trade liberalisation around the globe. South Africa, and perhaps more importantly Africa, will be influenced by many of these events. The objective for this paper is to outline and examine some of the key events and place a special emphasis on how they may impact on South Africa’s trade policy. This examination is however undertaken at a time of much uncertainty, with that uncertainty mostly about the trade policies that will be pursued by the incoming United States’ President in the wake of his prolific rhetoric during his election campaign.

Two of the major political events that stunned the world during 2016, were the so-called Brexit vote for the United Kingdom (UK) to exit the European Union (EU) and the election of Donald Trump to be the next United States (US) President. It is well to remember that in both cases the votes were triumphs for democracy in two of the world’s longest standing democratic countries. People voted and this was the result. Looking deeper into the underlying reasons for the outcome in each case is the generally accepted view that these were protests against the establishment and so-called ‘people power’ calling for change. These underlying causes seem to be both simplistic and complex at the same time. They are simplistic in the sense that in the UK people were worried about the economic situation in Europe and the dividing gap between the struggling south and the prosperous north and the bogey of an immigration wave, while in the US it seemed to be a vote between two candidates whom few felt much affinity towards, and a message to the establishment. Yet it is the complex under-the-surface factors that are the important ones, and these are likely to influence short to medium term policies in both countries, and of course given the role of both countries on the world stage these quickly transmit through to global implications.

The objective of this paper is to set the background for a discussion and analysis of the EAC-EU Economic Partnership Agreement (EPA) and the implication of Brexit on the overall trade relations between Kenya and the UK. The first and most obvious point it that there is currently great uncertainty on many issues, and that virtually all of trading partners with the UK are in the same position. There will therefore be an involved and time-consuming process as everyone tries to get their place in the queue to discuss several different issues with the UK.

The irony for Kenya and indeed Africa is that the ink is not yet dry on Kenya’s signing of the EPA after a long and almost tortuous process when the Brexit outcome dramatically altered the policy landscape with Kenya’s main trading partner in the EU. We start this paper by describing in detail the evolution of the trade agreements through to the ink-is-still-wet signing of the EPA, and then outline Kenya’s trading profile with the EU and the UK. This profile is set against the role of the East African trading partners in both Kenyan trade overall and the EAC-Kenyan profile with the EU. We introduce some of the many other factors such as the possible impacts of Brexit on the UK Pound and these implications for Kenya and other trading partners.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Over the last fifty years or more the most remarkable feature of global economic growth has been the growth demonstrated by the so-called ‘Asian Tiger’ economies (Hong Kong, Singapore, South Korea, and Taiwan). After the early leadership in growth by Japan we saw the next group (Singapore, Hong Kong, Korea and Taiwan) progress through the developmental stages to become modern high-income countries. This group was followed by the next wave of countries (loosely Malaysia, India and perhaps China with the latter being more of a tsunami than a wave), and then possibly Thailand and Indonesia. More lately we are seeing the ‘Tiger Cubs’ (Vietnam, Laos – the Lao People’s Democratic Republic – and Cambodia). The missing aspirant here is the Philippines, which started with a growl that faded to a whimper.

The objective of this paper is to assess the economic profile and progress of South Africa against these Asian growth economies, with special reference to the role of manufacturing in their growth and to ask if South Africa’s aspirations to emulate these growth patterns are realistic. We concur that South Africa did not capitalise on the opportunities it had in the 1990s (and later) to move forward from its then strong industrial base and large pool of cheap labour to emulate the Asian success. We appreciate that South Africa was emerging from a troubled period in its history, but we counter this by pointing out that China, Vietnam, Cambodia and Laos were all similarly emerging from their own troubled periods.

The paper starts by examining growth rates from the early 1960s, and shows that over this period and, more importantly, over a period from around 1990 South Africa has not been measuring up to Asian standards. Much has been written on the so-called Asian growth miracle, and driving this wave have been a complex mix of factors and policies. But two common themes emerge, namely their industrialisation with the emphasis on exports to the United States of America (US) and their ability to build a sound economic and overall infrastructural base from which to launch this development assault. Are these options open for South Africa? Current policy indications are that they are not.

The objective of this paper is to set the background for a discussion and analysis of the old Trade Development and Cooperation Agreement (TDCA) and its replacement the SADC Economic Partnership Agreement (EPA), and the implication of the decision by the United Kingdom (UK) to leave the European Union (EU) – the so-called Brexit. The examination concentrates on South African agricultural exports, with agriculture as defined by the World Trade Organisation (WTO) Agricultural Agreement.

We will examine South African (SA) agricultural trade with the EU and isolate the UK component to assess these possible Brexit issues. This is necessary as just when it looked as though the new TDCA/EPA trade relationships with the EU were somewhat settled the UK has thrown a curve ball by voting to leave the EU. There will be a period of considerable uncertainty and significant trade negotiating issues ahead. This will give South Africa (and all UK other partners) a renewed opportunity to re-negotiate trade access into an isolated UK in its own right rather than as a part of the greater Europe.

One of the important reasons for South Africa to participate in the EPA negotiations while it was still phasing in the provisions of the TDCA was that it wanted to harmonize the trading regime between SACU as a whole and the EU rather than have two separate agreements. With SADC-EPA it ensures that common external tariffs are maintained in all the trading partners and provide South Africa with an opportunity to correct some of the imbalances of TDCA, and particularly in agriculture. The political landscape has now changed.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Media reports described South Africa’s recently announced withdrawal from the International Criminal Court (ICC) as showing “startling disregard for justice from a country long seen as a global leader.” Amnesty International said South Africa was “betraying millions of victims of the gravest human rights violations and undermining the international justice system”.

The political fallout of this decision can be huge; South Africa played a dominant role during the 1990s in the setting up of the ICC. Other African nations may follow suit, which will undermine the effectiveness of what has become a unique forum to deal with international crimes and grave human rights violations. Burundi already said it would withdraw, and Namibia and Kenya have raised similar plans. The ICC has been criticized as targeting African leaders, despite issues of admissibility of cases being governed by the Rome Statute. As a rule the Court does not select its own cases.

The South African withdrawal announcement came unexpectedly. There was no explanation on how the matter was decided or why it was urgent. The announcement was accompanied by a statement that the Government is now also abandoning its appeal against the 2015 Judgment by the High Court of South Africa which found that, as a question of applicable law, the Government was compelled to arrest President Bashir pending a formal request for his surrender from the International Criminal Court for war crimes, crimes against humanity and genocide. That judgment also found that the conduct of the Government was inconsistent with the Constitution of the Republic of South Africa and invalid.

The reasons offered by the South African Government as to why it is withdrawing from the ICC are discussed here, together with some of the domestic and International legal principles which now come into play. There are broader governance issues and they will also be mentioned.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

The landmark decision by the World Trade Organisation (WTO) members in December 2013 in Bali at the 9th Ministerial Conference on a Trade Facilitation Agreement (TFA) remains the most key of recent achievements of the WTO, the first multilateral trade agreement concluded since the establishment of the WTO in 1994 by the Marrakesh Agreement, commonly referred to as the WTO Agreement.

After the historic agreement by the 9th Ministerial Conference in Bali, the rest of the work on the finalisation of the TFA was assigned to the WTO General Council. The General Council, which consists of the entire WTO membership, was mandated by the 9th Ministerial Conference to undertake all preparatory work necessary to bring the TFA into force. The major work to be done was the preparation and adoption of the Protocol of Amendment to the WTO Agreement.

This paper explores developments following the endorsement of the TFA by WTO members in December 2013. In particular the paper will take stock of the members that have ratified the TFA to date, including a review of the trade facilitation measures that the countries have notified to the WTO under the different categories. More focus will be on the African countries, members of the WTO that have made notifications. Such focus would assist in informing the negotiations under both the Tripartite Free Trade Area (TFTA) and the envisaged Continental Free Trade Area (CFTA). The paper will attempt to discern any trends in the notifications by these African countries as that would assist members of both the TFTA and the CFTA in developing regional approaches to trade facilitation under the envisaged new Free Trade Areas.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

The facts pertaining to the recent difficulties between the United States and South Africa about the latter’s continued enjoyment of the trade preferences of the African Growth and Opportunity Act (AGOA) were well covered in the media. The trade governance context, on the other hand, has received less attention.

The legal principles that apply to this matter and how South Africa’s continued participation under AGOA will be made conditional on prior changes to South African trade measures affecting American exports, have, for example, not been explained. Why were political stakeholders and lobby groups so actively involved? And why has it been so difficult to resolve this issue?

This paper takes a look at these issues within a broader trade perspective. It discusses the “governance” context of the AGOA regime as it now pertains to South Africa. We also look at possible lessons to be learned from the AGOA renewal debate, the conditions set for South Africa’s continued participation, and how the agreement reached will be implemented. These developments raise questions about future trade relationships between these two countries and how to manage them.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

This trade brief looks at the export performance of Kenya’s trade with the United States of America (US) and, more specifically, it concentrates on the preferential trade accorded to Kenya by the US. With an estimated real Gross Domestic Product (GDP) of US$61 billion in 2014, and a real GDP growth averaging around 5% over the past three years, Kenya is considered the economic and transport hub of East Africa. The economy is mainly driven by agriculture which contributes about 25% to GDP and also sustains 80% of Kenyans who work at least part-time in this sector. The country, however, still has high levels of unemployment (40%) and poverty despite the positive economic growth. Corruption, reliance on primary low-value commodities and infrastructure constraints are attributed to the current state of affairs in the country although its government has prioritised infrastructure development to ensure that Kenya remains on a growth and development trajectory.

The rest of the paper briefly addresses the African Growth Opportunity Act (AGOA) and recent developments since the extension of the AGOA. Eligibility criteria are also briefly discussed to provide a background to AGOA. Following this we look at the trade profile of AGOA-eligible countries focusing on their exports to the US (with or without preferences). We then narrow down the focus to Kenya’s trade with the US, also focusing on imports by the US from Kenya (Kenya’s exports). Here the analysis splits the trade under different regimes to ascertain whether the bulk of trade is benefiting from AGOA or not. We also look at the main competitors for goods exported by Kenya to the US under two regimes, AGOA (without the Generalised System of Preferences – GSP) and under the GSP (extended programme). This is then followed by a conclusion.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

This trade brief looks at the export performance of Lesotho’s trade with the United States of America (US) and more specifically it concentrates on the preferential trade accorded to Lesotho by the US. The country had a Gross Domestic Product (GDP) (Purchasing Power Parity) (PPP) of $5.282 billion and a real growth rate of 2.2% in 2014 and it relies on South Africa for much of its economic activity. For example, Lesotho imports 90% of its consumption goods from South Africa, including most agricultural inputs. Remittances from South Africa are a major income source for households from family members working in South Africa, in mines, on farms and as domestic workers.

The economy continues to face numerous challenges. These include ‘a lower degree of diversification, low domestic savings leading to over-dependence on foreign capital inflows, high unemployment, widening inequality and poverty, as well as spatial exclusion. Added to this is the burden of HIV/AIDS, particularly on the young generation. Together with high inequality (Gini Index of 0.52) these have implications on social spending to protect the vulnerable population’. Despite political challenges, the economy has remained resilient and is expected to grow by an average rate of 4.9% in 2015 and 2016.

The rest of the paper briefly addresses the African Growth Opportunity Act (AGOA) and developments after the extension of the AGOA. Eligibility criteria are also briefly discussed to provide a background on AGOA. Following this we look at the trade profile of AGOA eligible countries focusing on their exports to the US (with or without preferences). We then narrow the focus on Lesotho’s trade with the US, also focusing on imports by the US from Lesotho (Lesotho’s exports). Here the analysis splits the trade under different regimes to ascertain whether the bulk of trade is benefiting from AGOA or not. We also look at the main competitors for goods exported by Lesotho to the US under two regimes, AGOA (without the Generalised System of Preferences – GSP) and under the GSP (extended programme). This is then followed by a conclusion.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

African countries’ trading relationships have been changing in recent years. Trade with their traditional trading partners, the European Union and the United States (their ‘old’ friends) is declining. Trade with ‘new’ friends, such as China and India, is growing. For South Africa in particular, the rest of Africa has become a very important export destination. For South Africa and the other members of the Southern African Customs Union (SACU), these African countries have become ‘good’ friends.

This collection of studies, prepared as part of the ongoing collaboration between the Trade Law Centre (tralac) and the National Agricultural Marketing Council (NAMC), includes special focus on agricultural trade relationships and related issues such as climate change. Previous books have covered trade matters ranging from South Africa’s trade relationship with the Americas, Asia, as well as African countries. This book looks at all South Africa’s trading partners: new friends, old friends and good friends.

New friends: The so-called BRICs (Brazil, Russia, India, China) are new friends, with emphasis on the political dimension of the relationship. In agriculture terms, these countries offer opportunities as well as challenges. China is most competitive in industrial production, Brazil in agriculture and India in services. Although they compete with South Africa economically, diplomatically and politically, they are indeed our ‘new’ friends.

Old friends: Scholars such as Professor Nick Vink have argued that South Africa’s agricultural export product mix has remained the same for over 100 years, dominated by fruits and wines. These scholars further argue that the export destinations have also remained largely similar. These are dominated mostly the European Union (EU) member countries and United States of America (US). In the past two decades, following the removal of sanctions on South Africa, the bilateral agreements as well as the preferential market helped provide access for South African products into these markets under either Trade Development Cooperation Agreement (TDCA) with the EU and the Africa Growth Opportunity Act (AGOA) with US. These are South Africa’s ‘old’ friends.

Good friends: African countries are described as ‘good’ friends. Regional integration is an important policy objective, and African markets are growing in importance for agricultural, industrial and services exports from South Africa. The negotiations to establish a continental free trade area were launched in June 2015, and could offer more opportunities as many African countries are growing at rates much faster than the South African economy.

This book was compiled with the aim of examining the trading relationship between South Africa and its friends. Although agricultural trade is a key focus of the book, the full trading profile is presented.

© 2015 Trade Law Centre and National Agricultural Marketing Council

Publication of this book was made possible by the support of the Trade Law Centre (tralac) and the National Agricultural Marketing Council. The views expressed by the authors are not necessarily the view of any of these institutions.

Readers are encouraged to quote and reproduce the material contained in these books for educational, non-profit purposes, provided the source is acknowledged. Please contact us to obtain authorisation for reproducing this material.