Before the clear US statement that its benefits were in danger, the South African government was hopeful that the country would keep its preferential trade terms with the US when the Agoa trade pact is renewed in 2025.
South Africa has enjoyed significant advantages since Agoa was instituted in 2000, but it is now clear that this could change because of South Africa’s perceived support of Russia in the Ukraine war. This threatens South African exports which have enjoyed duty-free access to the US, including automotive vehicles and components, mining and chemical products, and agricultural goods such as wine and fruit.
The African Growth and Opportunity Act is a unilateral trade deal because it’s a piece of legislation passed by the US congress extending trade benefits, including duty-free access, to a number of African countries. The US can therefore change the terms of that legislation at will.
South Africa’s Minister of Trade, Industry and Competition, Ebrahim Patel, told parliament this month that the government has engaged the US government, as well as politicians and business groups, in discussions over the Agoa renewal.
He said South Africa had constructive engagements with the US government in 2015, when renewal was nearly scuppered by a dispute over US poultry exports to South Africa, and he hoped for constructive talks this time as well.
At a briefing ahead of his parliamentary speech, Patel said South Africa valued its relationship with the US enormously.
“We will be working closely with the US administration in making the case for why South Africa should remain in Agoa, and we hope that we are successful,” he said.
Image: President Cyril Ramaphosa receiving Secretary of State, Mr. Antony J. Blinken, in Pretoria, 2022. Photo courtesy of GCIS.
