The South African government is getting lots of reminders that anti-dumping duties on chicken imports from Brazil and four European Union countries are due to be imposed in a few months’ time.
They were actually due to come into effect a year ago, but Ebrahim Patel, Minister of Trade, Industry and Competition, decided last August to delay their imposition by 12 months. Although he agreed with the official investigation, which found that dumping was happening, and harming the local poultry industry, he feared that new import tariffs could add to food price inflation.
Patel has stood firm for the past year, neither commenting on the issue nor giving any hint of whether he plans to impose the tariffs in August or announce a further delay. He has not responded to pleas from the poultry industry to cut short the 12-month suspension because dumping is adding to the woes of an industry already in distress due to power cuts and high input prices.
Whether he is listening to pleas from chicken importers that he should do nothing to hamper the lucrative chicken import business remains to be seen.
FairPlay has weighed in, arguing that the poultry industry is a microcosm of the country’s wider national challenges.
Action against dumped imports is not only crucial for the local poultry industry, but for the way South Africa and its future are viewed, FairPlay founder Francois Baird wrote in Business Day.
“Opening the door to dumping, as Patel did last year, increasingly becomes a question about how soon SA wants to be classified as a fragile or failed state rather than a debate about food prices or an industry’s interests,” he said.
“On almost every key metric our global risk ranking has degraded significantly over the past 10 years. Even ANC secretary-general Fikile Mbalula has conceded that SA is at risk of becoming a failed state.”
The poultry industry has scaled back production because of a “terrible perfect storm” that had in effect wiped out the capacity gains in which the industry had invested in terms of the poultry master plan backed by Patel.
“If the import tariff suspension is not ended in August there will simply be a continued decline in domestic production that threatens long-term domestic food security – a non-negotiable in anyone’s book,” Baird said.
The South African government had to curb the country’s slide towards fragility by tackling the endemic power, corruption and other systemic issues – difficult problems to solve.
“An easier one is ensuring a fair and just trade regime which does not sell precious jobs down the river. While ensuring affordable chicken for the SA population is vital, so is safeguarding the local poultry industry and the jobs it provides.
“This is the kind of challenge we need to confront decisively to avert a slide into increased fragility. Patel holds that power in his hand,” Baird wrote.
