UPDATE: Tensions between USA and SA continue to rise over AGOA trade deal

By mahlokoane percy ngwato

Follow @AfricaBizReview on Twitter.

In the most recent spat between US senators and the South African poultry industry, pressure has mounted on both sides to reach an agreement over poultry tariffs with potentially thousands of jobs hanging in the balance.

Since its inception in 2000, South Africa has been able to export many goods tariff-free to the American market whilst retaining the right to protect much of its home industries.

Tensions have arisen over how these duties affect competitiveness between the two nations. A block of US senators has consistently highlighted that poultry imports have been effectively blocked by South African tariffs; senior African Union trade officials have noted the dominance of raw materials and oil exported to the US. 

13 US senators have written to the South African Minister for Trade and Industry Rob Davies in a bid to secure the removal of the tariffs. Similar to past communications, the threat of exclusion from the trade deal has never been far away from the negotiations.

In a rebuttal of sorts, CEO of the South African Poultry Association (SAPA) Kevin Lovell said, “The application of these duties has never been challenged by the US in the courts or at the World Trade Organisation – the correct forum for this kind of remedy – speaks for itself.”

Opinion in support of the US has noted that, since South Africa is by far one of the most advanced and successful African beneficiaries of the deal, its position within AGOA is becoming untenable in the light of the stubbornness of its poultry industry.

Conversely, South Africa’s poultry industry cites cheap American imports as a threat to local jobs and industry. Indeed, Senegal claims to have lost up to three quarters of its poultry trade due to the ‘dumping’ effect from the EU market as part of a similarly conceived trade deal.

In this particular instance AGOA is becoming a Catch 22 situation for South Africa: consumers will benefits from cheap imports but this will cost the country an as yet unknown portion of its home poultry industry. This is exactly why negotiations are crucial for the mutual benefit of all the interests involved in the deal. 


Featured Articles

Top 10 fastest-growing Indian companies in the UK

Business Chief takes a look at the top 10 fastest-growing Indian companies in the UK, according to the India Meets Britain Tracker from Grant Thornton

Top 10 workplaces prioritising people and planet in the UAE

Sustainable, flexible, collaborative, tech-driven, and amenities-rich, the office of the future considers both people and planet – here are 10 in the UAE

Top 10 female HR execs leading Saudi’s workplace transition

As Saudi pushes for more nationals and women in the workplace, all eyes are on the Kingdom’s HR leaders. Here, 10 female HR execs leading the transition

Top 10 largest asset managers by AUM operating in the UAE

Corporate Finance

Top 10 female CEOs leading Africa’s biggest businesses

Leadership & Strategy

Top 10 Executive MBA programmes in the United Arab Emirates

Leadership & Strategy