South Africa has until March 15 to fully comply with the US import of poultry as well as other meat.

This is the new deadline that has been set for South Africa, after US President Barack Obama on Monday ordered the suspension of duty-free treatment to all Agoa-eligible goods in the agricultural sector from South Africa, effective on March 15.

The suspension will be revoked should South Africa comply with the requirements to ensure the imports are on SA shelves, sources said. It is in effect another 60-day deadline for South Africa, after it concluded negotiations over health issues last week. That could happen within a month, but does put added pressure on the country to comply. 

Obama was expected to make this announcement last Tuesday, after South Africa failed to meet a previous 60-day deadline set by him to finalise negotiations around US meat imports, failing which he said he would suspend certain duty free tariffs on goods that benefit from the African Growth Opportunity Act (Agoa).

The act, renewed by US lawmakers in June, eliminates import levies on more than 7 000 products ranging from textiles to manufactured items and benefits 39 sub-Saharan African nations.

“I have determined that South Africa is not meeting the requirements described in section 506A(a)(1) of the 1974 Act and that suspending the application of duty-free treatment to certain goods would be more effective in promoting compliance by South Africa with such requirements than terminating the designation of South Africa as a beneficiary sub-Saharan African country,” Obama said in a proclamation released on Monday.

“Accordingly, I have decided to suspend the application of duty-free treatment for all Agoa-eligible goods in the agricultural sector from South Africa for purposes of section 506A of the 1974 Act, effective on March 15, 2016.”

While Minister of Trade and Industry Rob Davies announced on January 7 that the countries had completed negotiations on the various meat imports, US Ambassador Michael Froman warned there were more hurdles for SA.

“While we celebrate the progress we have made in resolving the outstanding technical issues, the true test of our success will be based on the ability of South African consumers to buy American product in local stores,” he said on January 8.

“We will be working to ensure that this final benchmark of entry of poultry is achieved so that South Africa continues to have the advantage of full Agoa benefits, including by working with the US and South African industries to expedite the shipment of eligible product as soon as possible.

“Our goal is to complete this effort so that South Africa can maintain the full and continued enjoyment of Agoa’s benefits.”

Sidwell Medupe, Department of Trade and Industry spokesperson, told Fin24 on Tuesday that the department will issue a statement later in the day, responding to this announcement.

Davies announced that after the negotiations over the salmonella issue were concluded on January 7, South Africa was immediately open to 65 000 tonnes of US poultry imports. The agreement means SA will rebate the US on any anti-dumping duties on the meat.

Asked how long it would take for shipments of US chicken to start reaching South Africa, Mike Brown, president of the US National Chicken Council, told Business Day newspaper that it was “just a matter of the South African government issuing import certificates for South African importers and the US government’s food safety and inspection service issuing paperwork to US exporters. I would hazard a guess that we could be in country within… 30 or so days by boat.”

New 60-day deadline

The National Security Council in Washington told SABC on Tuesday that it was not suspending South Africa’s Agoa benefits, but rather setting a new 60 day deadline for South Africa to comply.

“The office of the US trade representative says if the remaining benchmark – the entry of US poultry into South Africa under the agreed-upon conditions – is met before 15 March, the president will be able to consider a revocation of the proclamation before suspension takes effect,” SABC reported.

Obama can also reinstate full Agoa benefits after a suspension takes place.

“It seems that although the US is happy that the technical barriers were resolved last week, they are not prepared to let up the pressure on South Africa, and the implicit threat of removing the benefits of Agoa remain.”

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Presidential Proclamation – To Take Certain Actions Under the African Growth and Opportunity Act

January 11, 2016

1. In Proclamation 7350 of October 2, 2000, the President designated the Republic of South Africa (South Africa) as a beneficiary sub-Saharan African country for purposes of section 506A(a)(1) of the Trade Act of 1974 (the “1974 Act”) (19 U.S.C. 2466a(a)(1)), as added by section 111(a) of the African Growth and Opportunity Act (title I of Public Law 106-200) (AGOA).

2. Sections 506A(d)(4)(C) (19 U.S.C. 2466a(d)(4)(C)) and 506A(c)(1) (19 U.S.C. 2466a(c)(1)) of the 1974 Act authorize the President to suspend the application of duty-free treatment provided for any article described in section 506A(b)(1) of the 1974 Act (19 U.S.C. 2466a(b)(1)) or 19 U.S.C. 3721 with respect to a beneficiary sub-Saharan African country if he determines that the beneficiary country is not meeting the requirements described in section 506A(a)(1) of the 1974 Act and that suspending such duty-free treatment would be more effective in promoting compliance by the country with those requirements than terminating the designation of the country as a beneficiary sub-Saharan African country for purposes of section 506A of the 1974 Act.

3. Pursuant to section 506A(c)(1) of the 1974 Act, I have determined that South Africa is not meeting the requirements described in section 506A(a)(1) of the 1974 Act and that suspending the application of duty-free treatment to certain goods would be more effective in promoting compliance by South Africa with such requirements than terminating the designation of South Africa as a beneficiary sub-Saharan African country. Accordingly, I have decided to suspend the application of duty-free treatment for all AGOA-eligible goods in the agricultural sector from South Africa for purposes of section 506A of the 1974 Act, effective on March 15, 2016.

4. Section 604 of the 1974 Act (19 U.S.C. 2483) authorizes the President to embody in the Harmonized Tariff Schedule of the United States (HTS) the substance of the relevant provisions of that Act, and of other Acts affecting import treatment, and actions thereunder, including removal, modification, continuance, or imposition of any rate of duty or other import restriction.

NOW, THEREFORE, I, BARACK OBAMA, President of the United States of America, by virtue of the authority vested in me by the Constitution and the laws of the United States of America, including but not limited to sections 506A(d)(4)(C), 506A(c)(1), and 604 of the 1974 Act, do proclaim that: 

(1) The application of duty-free treatment for all AGOA-eligible goods in the agricultural sector from South Africa is suspended for purposes of section 506A of the 1974 Act, effective on March 15, 2016.

(2) In order to reflect in the HTS that beginning on March 15, 2016, the application of duty-free treatment for all AGOA-eligible goods in the agricultural sector from South Africa shall be suspended, the HTS is modified as set forth in the Annex to this proclamation.

(3) Any provisions of previous proclamations and Executive Orders that are inconsistent with the actions taken in this proclamation are superseded to the extent of such inconsistency.

IN WITNESS WHEREOF, I have hereunto set my hand this eleventh day of January, in the year of our Lord two thousand sixteen, and of the Independence of the United States of America the two hundred and fortieth.

BARACK OBAMA