Building capacity to help Africa trade better

Agoa quarrel can be resolved: US


Agoa quarrel can be resolved: US

Agoa quarrel can be resolved: US
Photo credit: Madelene Cronje | M&G

The United States embassy here shared South African Trade and Industry Minister Rob Davies’s assessment that South Africa and the US were “tantalisingly close” to concluding a meat trade deal that would save South Africa’s duty-free access to the lucrative US market for its agricultural exports.

However, embassy economic counsellor Laird Treiber also said on Tuesday that the US was watching closely to see if President Jacob Zuma signed a controversial bill that required US and other foreign private security companies to sell off majority stakes to South Africans. The US has warned before that that could also jeopardise SA’s trade access because it would be deemed as expropriation.

Treiber was briefing journalists about last week’s decision by President Barack Obama to suspend South Africa’s benefits under the African Growth and Opportunity Act (Agoa) for its agricultural products.

But Obama gave the South African government 60 days – until January 4 – to open its market to some US poultry, beef and pork imports if it wished to avoid losing its Agoa benefits.

South Africa has blocked imports of US poultry for 15 years, beef imports for 12 years and pork imports for three years, as Treiber said. For the past few years the two governments have been negotiating to lift the embargoes, which are now based on health concerns.

But they have not yet resolved the disputes, despite several deadlines set by the US. After Obama’s announcement of his decision to suspend SA’s Agoa agricultural benefits, Davies expressed surprise, saying that veterinary experts from both governments were negotiating the issues and were “tantalisingly close” to a deal.

He said he believed that deal would soon be concluded and that US poultry – the main issue in the so-called “three meats” dispute – could start entering South Africa before the end of the year.

Treiber agreed with that assessment. He said what remained outstanding in the negotiations was for both sides to agree on health certificates that would allow the US meat imports.

He said the two sides were very close to agreeing on health certificates on poultry and pork but still had a bit of work to do on beef. On poultry the main issue has been that South Africa wanted to maintain the total ban on poultry imports because of outbreaks of avian flu in some parts of the US.

The US wanted South Africa to “regionalise” its approach, by only barring imports of poultry from areas of the US affected by avian flu.

Treiber said the US was “very hopeful” these negotiations would conclude in time to allow poultry imports in before the end of the year and avoid SA’s suspension from Agoa.

The suspension would hit citrus and wine exports hardest.

He also noted that if the meat dispute was not resolved by March 1 next year, the US would consider suspending other Agoa benefits which SA enjoys. The biggest exports from SA to the US under Agoa are automobiles of which about $1,3 billion worth were exported last year, constituting 74% of all SA exports to the US under Agoa.

Treiber dismissed criticism that the US was bullying SA into accepting US imports. He insisted that Washington was acting in accordance with the rules that had been in place since Agoa was introduced in 2000, that African countries should maintain open markets to US goods, in order to quality for Agoa benefits.

Treiber said that SA was blocking US meat imports while allowing meat imports from many other producers which was putting the US at a disadvantage relative to its competitors.

Treiber was asked if SA would be immediately suspended from all of its Agoa benefits if Zuma signed into law a bill which has been passed by Parliament that would require US and other foreign owners of private security firms to sell off majority stakes to South Africans.

He said the US was watching this bill closely but if Zuma signed it, the US would have to study the legal implications and also give South Africa 60 days notice before taking action.


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