United States legislators are increasingly considering stronger measures against South Africa’s continued participation in the African Growth and Opportunity Act (AGOA), after the US Trade Representative indicated that Pretoria would be treated differently from other African countries in the renewed trade initiative.
United States Trade Representative, Ambassador Jamieson Greer was questioned by Republican Senator John Kennedy at a Senate Appropriations subcommittee hearing, regarding South Africa’s inclusion in the potential extension of AGOA.
Kennedy asked Greer: “What do you wanna do about South Africa as part of AGOA, given that South Africa is not America’s friend?”
Greer responded: “That’s correct. We have had some conversations with South Africans when it comes to trade, and there are a lot of kind of foreign policy issues that I do not get into with South Africa. But when it comes to trade, they have a lot of barriers …
“We have made it clear to the South Africans that if they want to have a better tariff situation with us they need to take care of these tariff and non-tariff barriers. “They are a real economy, they are a big economy, right. They have an industrial base, they have an agricultural base; they should be buying things from the United States,” said Greer.
Kennedy then put it to Greer that if AGOA is extended for one year, without reforming it, South Africa would benefit from the initiative.
Greer conceded, but highlighted that already, South Africa has been slapped with a 30 percent “reciprocal tariff which is much higher than the rest of the continent.”
He however, noted that South Africa is a unique case.
Kennedy went on: “Don’t you think we have to separate South Africa and AGOA?” Greer agreed, saying that he would be happy to consider that proposal.
“Congress has come to me and said we want AGOA. And if we are going to give away, we need to figure out how to improve it. If you think that we should give South Africa a different treatment, I am open to that, because I think they are a unique problem.”
Kennedy responded: “Well, they are a unique problem for America. I mean, they are our enemy right now. They are buddies with all of our enemies. And they have been very critical of the United States.”
Greer agreed: “That is exactly right. And that is why they are actually treated in a much different way. Most of the African continent, sub-Saharan Africa, has just a 10 percent, and South Africa has a 30 percent.”
Earlier this year, the United States imposed a 30 percent tariff on imports from South Africa after US officials failed to respond to several trade proposals submitted by Pretoria.
In July, IOL reported that President Cyril Ramaphosa had noted the correspondence from United States President Donald Trump on the unilateral imposition of a 30% trade tariff against South Africa.
Ramaphosa also noted that South Africa is one of a number of countries which have received similar communication announcing tariffs at the time.
“This 30% tariff is based on a particular interpretation of the balance of trade between South Africa and the United States. This contested interpretation forms part of the issues under consideration by the negotiating teams from South Africa and the United States,” said Ramaphosa’s spokesperson, Vincent Magwenya.
“Accordingly, South Africa maintains that the 30% reciprocal tariff is not an accurate representation of available trade data. In our interpretation of the available trade data, the average tariff imported goods entering South Africa stands at 7.6%.
“Importantly, 56% of goods enter South Africa at 0% most favoured nation tariff, with 77% of US goods entering the South African market under the 0% duty,” he said.
However, the Presidency in Pretoria made it clear that South Africa continues with efforts to nurture closer trade relations with the United States. – IOL
