TRALAC - Trade Law Centre

Opinion: 'Trump vs. Biden: This is how it could impact South African agriculture'

Thursday, 05 November 2020 Published: | Sinesipho Tom

Source: Food for Mzanzi

As the race for the White House continues, agriculture leaders say a win for Democrat Joe Biden will strengthen and fast-track trade relations between South Africa and the United States.

Currently, the race between pres. Donald Trump and Biden hinges on tight races in battleground states. Trump has already falsely claimed victory while Biden called for patience and every vote to be counted.

Meanwhile Mzansi’s [>South Africa<] agriculture leaders believe a second-term win for Trump will lead to a continuation of the trade war with China which will benefit exports in the agricultural sector immensely.

Christo van der Rheede, executive director of Agri SA, tell Food For Mzansi there is a huge opening for South Africa’s agricultural export sector if the trade war between China and America continues.

“If Trump wins, it means that he is going to pursue a very inward-looking policy framework. In other words, he will protect the American economy, try to create more jobs in the process and try to prevent people in other countries, especially China, from flooding the American market.”

This could, in turn, create access for South African agriculture, says Van der Rheede. “So, there’s a massive opportunity for South Africa and we’ve seen how South Africans actually benefited from that trade war, or that tit for tat between America and China. We could export citrus, we could export soya, we could export maize and meat, again, to the Asian countries, especially in China.”

“It is going to create a massive distortion in global trade and global supply,” Van der Rheede says. “The last thing you want to see is for the rest of the world to suffer as a result of that. The World War and social instability in many countries was caused by food shortages and we’ve seen that happening in 2007 and 2008. We must also remember that the war in Syria was a direct result of that, and the global protectionism that occurred in 2007 and 2008.”

‘More sympathetic towards SA’

Another concern for Van der Rheede is that Africa might lose the African Growth and Opportunity Act (AGOA). This trade programme is meant to establish stronger commercial ties between the United States and sub-Saharan Africa.

“Trump might decide to completely scrap AGOA and use it as a sort of tactic to force South Africa and other African states to support his regime. That in itself poses a serious threat for our motor industry and other industries that export goods like motor cars to the United States,” he says.

Meanwhile Theo Venter, a political and policy specialist and lecturer at the North West University’s Business School, believes that South Africa should not worry much about AGOA as it is only up for renegotiation in 2025.

“I think AGOA will be part of the trade relations between South Africa and America, but I don’t see any serious changes to AGOA in the next two to three years. It may be that since Trump is a little bit more established in a second term, he may weigh in on South African issues, such as land reform, and rural safety which he has done, but not very explicitly. So, that may be one of the things that might happen. I don’t give that a very high value in my view, because remember, Trump is a global leader and Africa is a small player in the global issues,” he says.

Venter and Van der Rheede also weighed in on what the implications would be if Biden won the 2020 US elections. Both leaders agree that the former US deputy president would be more sympathetic to South Africa than Trump was in his presidency.

“If Biden comes into play, obviously the upside is that Biden has a soft spot for Africa. So, he will perhaps even re-look AGOA and try to expand to strengthen trade relations between Africa and the United States. So, there’s a particular advantage in that,” says Van der Rheede. However, if trade opens up completely, our emerging farmers will suffer the most, he says. “South Africa will have to be at the forefront of its own competitiveness.

There won’t be any favouritism and then we must compete like any other country, to be at the forefront of quality products to the rest of the world. That won’t be a problem, but it will be for our emerging farmers, who are already struggling to comply with a lot of quality standards.” Biden could boost AGOA Venter believes if Biden becomes the next US president trade relations with different nations will become much quicker and civilised.

“We’re not going to have this kind of windfall that we’ve had under Trump with the uncertainty. Under Biden we will also have less issues with AGOA.” He reveals that in Biden’s presidency we will get a new ambassador in South Africa.

“She was appointed only recently and that that may also change the relationship between the two countries. But I don’t see a very, very serious change in normal relations between us and the Americans, even among any one of the two.

It’s not as if we have very close relations with the Americans as we move, but I think under Biden, things would be a little bit more relaxed than under Trump,” he says.

 

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