Johnathan Paoli
THE Department of Trade, Industry and Competition (DTIC) has expressed its confidence in the relationship between the country and the United States of America, despite no official renewal of the African Growth and Opportunity Act (AGOA) yet.
DTIC Minister Parks Tau and his deputy, Andrew Whitfield briefed the media on Tuesday and said the possible exclusion of South Africa, following rumoured tensions between the two countries, was not on the table.
This follows the attendance by Tau and Whitfield of the 21st AGOA Forum in Washington, DC, accompanied by a delegation, in order to engage with US stakeholders with a view to strengthen trade and investment relations.
AGOA provides for duty-free access to the US market for a significant portion of the country’s goods, SA’s second-largest export partner with R61.49 billion of goods exported to the US in the first five months of this year.
Tau said currently, there are over 600 US businesses in operation in South Africa and over 1.3 million jobs have been created in the sub-Saharan region.
Only 14 months are left before AGOA expires, the DTIC delegation hoped for an early, 16 years extension in order to facilitate predictability and certainty to buyers, exporters and investors.
The Minister said that the delegation presented proposals on the extension of AGOA for stability, improved rules of origin and adjustments to the eligibility review process to preserve regional value chains and enhance the continent’s manufacturing capabilities.
However, he confirmed that no definite decision has been reached.
Despite not receiving any confirmation as regards to timelines, Tau said one of three scenarios could unfold: re-authorisation before the US November elections, extension between the elections and inauguration, and re-authorisation after the inauguration.
Tau said the main message was to reset and create partnerships with an emphasis on industrialisation, building a capable state and the creation of jobs.
Whitfield said there was an enthusiasm to strengthen the AGOA agreement, despite the previous concerns.
“My feeling leaving Washington DC, based on the previous months in the run-up to this, is that we had a positive visit. We had a feeling very much that our relationship within AGOA is not going anywhere,” he said.
Assistant US trade representative for Africa, Connie Hamilton, previously said considerations of extension were still underway.
“South Africa, like all the other countries, will be evaluated based on the criteria, and then we’ll have a decision, but it’s too early now to predict what the outcome will be for any country, not just for South Africa,” Hamilton said.
This comes on the heels of the passing of the US-South Africa Bilateral Review Act by the House of Representatives, calling for the Biden administration to undertake a full review of South African relations with the country.
US officials questioned SA’s eligibility because its warm ties with Russia, China and Iran were deemed to threaten US national security and foreign policy interests, violating an AGOA condition.
The Minister said despite SA consistently maintaining a non-aligned position, some in the US have perceived the country might not have articulated its non-alignment in a manner that is demonstrable.
The formation of the Government of National Unity (GNU) has greatly assisted lobbying efforts, with some calling it a “honeymoon period”, due to the perception that SA would adopt more ‘moderate’ positions on trade and foreign policy.
“There was a lot of interest in the GNU and its priorities, including efforts to deepen and enhance bilateral relations with the US. We welcome the support expressed by both the Biden Administration and Members of Congress for the renewal of AGOA,” the minister said.
Deputy Minister Zuko Godlimpi on the other end represented South Africa at the pivotal BRICS+ Trade Ministers Meeting, with the aim to call for a predictable, fair and equitable trade environment consistent with the World Trade Organisation’s rules as crucial for advancing economic prosperity.
Godlimpi said some of the outcomes emanating from the meeting included: the need for coordinated multilateral action on climate change, the potential of e-commerce to enhance market access and economic growth, and the role of special economic zones in driving economic growth and investment.
Departmental spokesperson Sidwell Medupe said both the AGOA forum and BRICS+ ministers’ meeting underscore the importance of cooperative trade relations in shaping a more equitable and sustainable global economy.
“They both underscore South Africa’s commitment to pursue transparent and strategic partnerships with both our Global North and Global South partners guided by the global policy and programmatic blueprints,” Medupe said.
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