Statement from U.S. Ambassador regarding South Africa’s status under the African Growth and Opportunity Act (AGOA)
“During the past year, I have worked closely with leaders in government and industry in both of our countries to resolve the longstanding barriers to U.S. trade with South Africa, particularly with regard to American poultry, pork, and beef. The U.S. arrived at the decision to suspend certain AGOA benefits for South Africa only after many months of discussions. While the United States and South Africa have made significant progress in resolving outstanding issues, our trade in all three meats remains blocked. I am optimistic that the two sides will resolve the few remaining issues that would allow trade to resume, and hope that this will happen before the changes go into effect in 2016. We see enormous potential to strengthen our trade and investment ties with South Africa, which we believe could create significant numbers of new jobs and spur economic growth.” – Ambassador Patrick Gaspard
On June 29, 2015, President Obama signed into law a bill reauthorizing AGOA for an additional 10 years. The bill included an amendment requiring a review of South Africa’s eligibility within 30 days. On July 21, 2015, the U.S. Trade Representative (USTR) launched an out-of-cycle review of South Africa’s AGOA eligibility, during which the U.S. made it clear to the South African government that South Africa needed to take concrete steps eliminating barriers to U.S. trade and investment, a key criterion to remain eligible for AGOA trade benefits.
Following the out-of-cycle review, the President has determined that South Africa has failed to meet AGOA eligibility requirements – specifically that it has not eliminated or made continual progress towards eliminating barriers to U.S. trade, including long-standing barriers to U.S. poultry, pork, and beef. As a result, the President has notified Congress and South Africa today of his intent to suspend duty-free treatment for all AGOA-eligible agricultural goods from South Africa, beginning 60 days after the date of this notification.
We will continue to monitor South Africa’s compliance with AGOA requirements and, if we determine that the initial suspension of duty-free treatment has not resulted in compliance with AGOA eligibility criteria, we will consider, no later than March 1, 2016, further action to limit, suspend or withdraw duty-free treatment for additional AGOA-eligible products from South Africa beyond those in the agricultural sector.
Suspension of the Application of Duty-Free Treatment to all AGOA-Eligible Goods
In accordance with sections 506A(d)(4)(C) and 506A(c) of the African Growth and Opportunity Act (AGOA), I am providing 60-day advance notification of my intent to suspend the application of duty-free treatment to all AGOA-eligible goods in the agricultural sector for the Republic of South Africa 60 days after the date of this notification.
I am taking this step because South Africa continues to impose several longstanding barriers to U.S. trade, including barriers affecting certain U.S. agricultural exports, and thus I have determined that South Africa is not making continual progress toward the elimination of barriers to United States trade and investment as required by section 104 of AGOA. I have determined that such suspension of benefits would be more effective in promoting compliance by South Africa with the eligibility requirements listed in section 104 of AGOA than the termination of South Africa's designation as a beneficiary sub-Saharan African country, as it would better promote continuing efforts between the United States and South Africa to resolve these outstanding issues. Although South Africa has to date failed to meet critical benchmarks required to address these issues, it continues to express an interest in resolving U.S. concerns.
I will continue to assess whether South Africa is making continual progress toward the elimination of barriers to United States trade and investment in accordance with AGOA eligibility requirements, as well as whether this suspension of benefits is effective in promoting compliance with those requirements.