Minister Davies in bid to save South Africa's AGOA access
Trade and Industry Minister Rob Davies has met with US Trade Representative Michael Froman as part of a stepped up effort to resolve a dispute involving US chicken imports into the local market and ensure South Africa’s continued participation in the preferential trade scheme, the African Growth and Opportunity Act (Agoa).
The meeting took place on the margins of the World Economic Forum’s annual meeting, which concluded on Saturday in Davos, Switzerland.
Davies told Business Report that the process to tackle the issue had now reached a stage where concrete offers were being made to resolve the matter. “This work has been ongoing,” said Davies.
He said that the process entailed “bringing our poultry associations together to work on a programme which would provide some additional market access for US poultry products, but which would also have a developmental component – which involves investments by US companies, training, skills development and support for intra-Africa trade.”
In the past year there has been a push for South Africa to lower tariffs on some US chicken imports, a campaign spearheaded by Senator Chris Coons of Delaware and his Republican counterpart Jonny Isakson of Georgia.
Last January the National Chicken Council and the USA Poultry and Egg Export Council testified before the US International Trade Commission on the matter, and warned South Africa to lift the imposition of dumping duties from US poultry products and allow trade to resume “fairly and without restraint” or risk losing its Agoa preferences.
Delaware Online reported Coons last week as saying: “I will find a way to prevent South Africa from benefiting from Agoa if we cannot resolve their illegal ban on the importation of US poultry.”
Entry into the South African market of US poultry would be one way of helping offset the ban imposed by Russia on US poultry imports, according to analysts.
Davies said “while there is still no firm date on when the US Congress will engage on the Agoa re-authorisation issue, it is possible that this may happen in the next month or two.
“We indicated to the US trade representative, Michael Froman, that the dialogue between our two poultry associations had now reached the point of exchange of offers. He noted and welcomed the progress,” said Davies.
According to Davies, the government would respond to what the poultry industry players came up with, but he added that a settlement deal would involve an offer on quota or tonnage. He said he was “a bit surprised” by the threats involving South Africa’s Agoa status.
“We hope that (the offers) will create the momentum for the re-authorisation of Agoa with South Africa included. That’s what we are looking to achieve,” said Davies.
Although President Barack Obama’s administration supports Agoa’s renewal, the decision will be made by Congress and some US business interests and legislators want South Africa to be “graduated” because it is an upper middle-income country and because they say it is discriminating against US imports.
Tom Donohue, the president and chief executive of the US Chamber of Commerce, told President Jacob Zuma in August that the chamber was lobbying Congress hard for a renewal of Agoa with South Africa in it.
But he said South Africa needed to protect US intellectual property rights and trademarks, strengthen investor protections, repeal anti-dumping measures “and settle ongoing issues over ownership of foreign-headquartered firms”.
Officials said South Africa was responding to these complaints by considering the introduction of a tariff rate quota agreement, which would allow a quota of US chicken imports into the local market at lower tariffs.
Read related news articles
Key provisions of the US’s AGOA Improvement Act
The office of the US trade representative has been leading the 2024 US-Sub-Saharan Africa Trade & Economic Co-operation African Growth & Opportunity Act (Agoa) Forum in Washington this week. Convening under the theme “Beyond 2025: Reimagining Agoa for an Inclusive, Sustainable and Prosperous Tomorrow”, the forum brings together senior government officials from the US and Agoa-eligible countries, as well as representatives from...
26 July 2024
New government of national unity gives South Africa a honeymoon period for keeping its AGOA status, say analysts
New Trade and Industry Minister Parks Tau is fighting for South Africa's continued participation in AGOA at the AGOA Forum in Washington this week. The formation of the Government of National Unity (GNU) has secured South Africa a “honeymoon period” for retaining its privileged access to US markets under the African Growth and Opportunity Act (Agoa). This is the view of US politicians and South African trade analysts on the eve of the...
23 July 2024
Rosa Whitaker: 'America can't be first if we keep putting Africa last'
Given the press of events closer to home, Africa is hardly top of mind in Washington right now. That President Joe Biden's foreign policy, economic and trade A-team is meeting with its African counterparts here this week is unlikely to change that. In a more rational world, it would. The meeting is the 21st AGOA Forum, named after the African Growth and Opportunity Act, requires that the get-together be held annually. This year's session is...
23 July 2024
South Africa plans US mission to lobby against US review of ties
South Africa’s newly formed government will use an upcoming forum on US preferential trade access to push back against a Senate review of ties between the two countries. The House of Representatives last month passed a law requiring a full assessment off bilateral relations and submitted it to the Senate for approval. South African business lobby groups have warned the legislation threatens to curb trade with the world’s biggest economy...
15 July 2024
How access to US market changed the fortunes of two South African sisters
Two entrepreneurs take traditional African designs and sustainable materials and turn them into international success What started as a pastime desire to sell crafts at local markets, deeply rooted in the South African culture, has since blossomed to become an international business entity for two local women.It took the Mokone sisters, Morongwe "Mo" (37) and Michelle (34), three years only to turn around their home decor business into an...
01 July 2024
US-Africa trade deal turns 25 next year: AGOA's winners, losers and what should come next
The African Growth and Opportunity Act (Agoa) is a landmark piece of trade legislation enacted by the United States in 2000. Its goal is to promote economic growth, development and poverty reduction in sub-Saharan Africa by providing qualifying countries with duty-free access to the US market for over 6,500 products. By eliminating import tariffs and quotas, Agoa aims to stimulate trade, attract foreign investment and foster economic...
06 May 2024
African trade coalition backs AGOA 16-year renewal bill to boost trade prospects
The African Coalition for Trade (ACT) has voiced its support for the African Growth and Opportunity Act (AGOA) Renewal and Improvement Act of 2024 and credits the bill with creating hundreds of thousands of direct jobs in Africa and the US. The AGOA Renewal and Improvement Act of 2024 which was introduced by Senators Chris Coons and James Risch would extend the bill for 16 years until 2041 and continue to boost Africa’s duty-free status as...
18 April 2024
US apparel and footwear industry supports 16 year AGOA renewal
The American Apparel & Footwear Association applauds Senator Chris Coons (D-DE) and Senator James Risch (R-ID) for introducing the AGOA Renewal and Improvement Act of 2024.Currently set to expire in September 2025, AGOA is a pivotal trade preference program that provides duty-free access to the U.S. market, fostering economic growth and opportunity between the U.S. and eligible African countries. This program is the cornerstone of...
11 April 2024
US senators introduce bill to renew Africa trade pact through 2041 [Download copy]
A bipartisan group of senators will introduce a bill to renew the United States' trade pact with sub-Saharan Africa ahead of its expiration next year, an aide to one of the senators said on Thursday. [ Download it here and download a summary here] The bill was introduced by Senators Chris Coons, a Democrat, and James Risch, the top Republican on the Senate Foreign Relations Committee. A cross-party group of...
11 April 2024
US manufacturing subsidies for Africa could help revive AGOA
Experts at the Center for Global Development argue that the unconventional approach could bring billions in new trade opportunities and would fit with US “friend-shoring” efforts. The US should pay ‘negative tariffs’ in Africa – essentially targeted manufacturing subsidies – to help revive its faltering African Growth and Opportunity Act (AGOA), according to a new report from the Washington-based Center for Global...
05 April 2024
South Africa walks a tightrope on US relations
South Africa has been conducting a high-wire act in its relations with the United States (US). It is maintaining friendships with Washington’s enemies like Russia, Iran and China while trying to avoid disrupting its economic relations with America. Tensions came closer than ever to breaking point this month as the US House of Representatives’ Committee on Foreign Affairs passed the US-South Africa Bilateral Relations...
28 March 2024