The AGOA treaty – the African Growth and Opportunity Act – came into operation in 2000. It offers numerous African countries, including South Africa, duty-free access to the US for nearly 7 000 items. It has been a major boost for a number of South African industries, and has facilitated huge exports of motor vehicles to the US.
The last time AGOA was renewed in 2015, the US suddenly attached a new condition if the treaty was to continue – SA had to accept more than 5 000 tonnes a month of US chicken portions, free of the anti-dumping duties. It was a make-or-break condition – no chicken quota, no AGOA and an end to exports which had been worth billions to the SA economy.
The South African poultry industry agreed reluctantly, accepting that they had to “take one for the team” as one executive put it, for the sake of the broader national interest. It hurt local producers then and it still hurts now – the US has risen to second behind Brazil as a source of chicken imports, and the duty free quota has climbed from the initial 65 000 tonnes annually to just over 72 000 tonnes currently.
AGOA is up for renewal again in 2025. South Africa is likely to try and get that quota removed from the treaty; the US may make its continuation another deal-breaker, or add further conditions to poultry or other South African industries.
They may even remove South Africa from the treaty altogether, or threaten to do so. That might not be a good move when the US is trying to foster better relations, but if Presidents Biden and Ramaphosa are talking trade in Washington next week, AGOA may well be up for discussion.
Again, it is the detail that will count. The AGOA background, including the 2015 poultry ambush, must be part of President Ramaphosa’s briefing pack.
