South Africa may have averted an immediate crisis and secured its participation in the US African Growth and Opportunity Act (Agoa), but a battle is brewing and the impact on trade could be significant. With the issues around poultry finally resolved after South Africa met all the requirements for its continued inclusion in Agoa as set by American President Barack Obama – albeit three days late – government officials are optimistic about the future.
At a press conference last week Minister of Trade and Industry Dr Rob Davies said there was a strong relationship between South Africa and the US built on solid foundations. He denied that the outof-cycle review launched by the American government threatening exclusion from Agoa – or South Africa’s slow reaction to it – would have any lasting effects. “The conclusion of the negotiations and us meeting their requirements has in our estimation brought an end to any disputes with the US. We think this episode we have gone through is now over and we want to build on our relationship with them,” said Davies.
Industry stakeholders, analysts and commentators, however, are not as confident. Peter Draper, managing director of Tutwa Consultants and an expert in trade and investment policy, told FTW the proximate issue at hand had been solved, but a far wider range of US government and business concerns were now set to raise their heads. “We have averted an immediate crisis by addressing the irritant in the relationship. There have, however, been far broader dynamics at play than what just meets the eye,” he said. “It is good that a solution has been found, but this is not the end of the saga.” Draper said far deeper political issues were at the core of the US out-of-cycle review. “There are bigger dynamics at play here such as the Private Security Bill, draft IPR policy, Promotion and Protection of Investment Act, and more. With the poultry issue solved we can expect that attention will now move to these concerns.”
Geordin Hill-Lewis, DA
shadow minister for trade and industry, said the entire poultry issue around
Agoa that threatened a vast range of agricultural and other export goods could
have been wrapped up in July last year. “This has been a bruising, damaging
episode for South Africa. We have done significant damage to our reputation in
the negotiating rooms of world trade and to our relationship with the USA. This
will take years to repair.” He said concerns by the US on the policy direction
of the SA government had not yet been addressed. “The Private Security Bill,
for example, would immediately exclude us from Agoa altogether, if it was
signed by the President. So they will continue to monitor us very closely.”
Draper said South Africa was definitely not out of the woods yet. “One has to
distinguish between high politics and low politics. For most countries this is
kept separate. For example, Washington may have numerous trade disputes with
the European Union (low politics) but it does not undermine the broader high
politics involved,” he said. “In the case of South Africa it is starting to
blur. We are seeing South African government officials outright blaming the US
over global issues such as Libya and Syria while at the same time forging
closer and closer trade ties with their Brics partners. The low politics is
starting to feed into the high politics environment and it could have severe
consequences for trade with the US.” Davies, however, maintains this is not the
case. “It was not an issue that was picked up in these negotiations that we are
completing now. The process was confined to the issues around the poultry and
meats and we have met the US requirements.”
Contributed by: 
As appeared on www.ftwonline.co.za - the daily
southern African freight and trade news portal
