TRALAC - Trade Law Centre

South Africa: New US president can't kick SA out of AGOA - Coons

Wednesday, 28 September 2016

Source: News24 Wire

Whether the next president of the United States is former first lady Hilary Clinton or business magnate Donald Trump, the African Growth and Opportunity Act (Agoa) is set to remain in place until 2025.

This is according to Delaware Senator Christopher Coons, the man who pushed for South Africa to be part of the renewal of Agoa.

"I don't expect, after this election, either president to go back and sort of reach in Agoa and tear it up," Coons told a small group of South African journalists ahead of the first presidential debate between Clinton and Trump.

Agoa is an American law originally passed by the US Congress in 2000, which allows eligible African countries to export a wide range of goods to the US duty free.

"It is part of, I think, a positive US-Africa trade agenda that sees opportunity of growing trade for both the United States and Africa," he said.

Coons said championing Agoa was not politically easy for him. "It helps a lot when I am specifically able to articulate in a way that benefits my state."

Delaware is one of the country's biggest producers of broiler chickens, making poultry the backbone of its agricultural sector and contributing $4.6bn to the state's economy.

"Given the current politics of trade, I can't predict whether there will be another renewal ten years from now, but Agoa is statute for the next ten years."

Coons noted that the trade agreement that has been most at issue during the presidential campaign is the Trans-Pacific Partnership, which is not yet ratified. It is essentially about expanding trade with Mexico and Canada, and nine to ten other Pacific partners.

"That agreement, I think in almost all certainty, will not move forward. But I don't expect, after this election, either president to go back and sort of reach in Agoa and tear it up."

The US and South Africa were at loggerheads over South Africa's eligibility to continue to participate in Agoa. At the heart of the impasse was eliminating barriers to US poultry, pork and beef imports into South Africa.

South Africa conceded by giving US exporters an annual quota of 65 000 tonnes at normal duty rates, after President Barack Obama issued a proclamation threatening to suspend duty free benefits to South Africa.

"It benefits our poultry industry as a whole, for us to be able to grow opportunities outside of the US," explained Coons. "Roughly 20% of all poultry produced in the US is exported and if that number continues to go up over time, our future in poultry improves."

Agoa is estimated to have created over 60 000 jobs in South Africa, with vehicles and car parts making up the bulk of exports to the US.

"In our broader politics in this election, there is a narrative that says that trade hurts Americans and we should stop seeking free trade agreements. I think Agoa is net positive for South Africa by a lot," said Coons.

 

* Fin24 is attending the US farm-to-fork programme as a guest of the USA Poultry & Egg Export Council.

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