Agricultural economist Wandile Sihlobo has repeated his advice that the South African government and exporters must not devote all their efforts to restoring trade relations with the United States, but must look elsewhere as well.
The recently announced 30% tariff on South African exports to the US “is not the end of the road,” Sihlobo said in his blog. While the US negotiations would remain a priority, he listed other markets where increased focus was needed to retain or expand access for South African agricultural products.
“As South Africa navigates the tariff issue in the coming weeks, there will be an increasing need to allocate resources and intellectual capital wisely when it comes to trade matters in general. We are in a rapidly changing world, and the global trading system has been upended.
“South Africa must increase its efforts in two areas: retaining existing markets in various regions of the world and expanding access in new places.
“This does not mean deprioritising the US, but adapting to the evolving world we live in. These processes involve both the effective deployment of the skill set available in the government and being open to new ideas from other stakeholders in society, such as business and academia.”
African countries and the European Union were vital markets, accounting for roughly two-thirds of agricultural exports, Sihlobo said. There was minimal capacity to increase exports to these regions, so the focus must be on retaining them through continuous interaction with embassies and active engagement in all established forums.
“In the EU, markets are diverse, but comprise mainly high-value fruits and wines. This access is crucial for the domestic industries, so importers and diplomats must be among our priority contacts; they cannot be allowed to fall off the radar screen due to all the attention on the US.”
Beyond Africa and the EU, the Middle East and Asia were among SA’s most significant agricultural export markets.
“In Asia, Japan, South Korea, Taiwan, Vietnam and China are among the key countries South Africa has access to, and where we could still increase exports. However, the immediate issue remains relatively high import tariffs and phytosanitary barriers,” Sihlobo said.
“Engaging China practically and with speed about its proposal to lower tariffs, while guarding against costs to sensitive domestic industries, is an urgent priority. In the Middle East, the likes of Qatar, the United Arab Emirates and Saudi Arabia remain crucial for export expansion in fruits, red meat, live sheep and grains.
“Beyond addressing the tariffs and phytosanitary measures that are in place, we will also require an increase in marketing efforts to boost demand for SA Inc. products in these markets.” Sihlobo concluded.
