The different United States trading environments South Africa would face, for the next two years under President Donald Trump and after that under a new US administration, were emphasised during a trade webinar hosted by the FairPlay movement.
The webinar, hosted by FairPlay founder Francois Baird, focused on the future of the Africa Growth and Opportunity Act (AGOA) and its benefits for African countries. It also branched out into President Trump’s trade and tariff policies, and how things might change after 2028.
American trade experts noted South Africa’s AGOA benefits had largely been negated by rounds of new tariffs from the US. Countries that had exported to the US were diversifying to other markets because of the unpredictability of US trade policy. South Africa’s citrus industry is an exception – it has long had an export diversification policy.
South Africa was advised to make more use of its embassy in Washington to showcase its export products, to engage lobbyists to promote South African interests to the US administration, and to change its policies to make them more acceptable to US politicians. They also advised South Africa to engage directly with US states that want to promote more trade directly with South Africa.
Prof Diana Furchtgott-Roth an adjunct professor at both the George Washington University in Washington DC and University of the Free State in Bloemfontein noted that South Africa’s ties to countries viewed as inimical to the US were a hindrance to trade ties.
Trade expert Andrew Hale said all of the tariffs imposed by President Trump were illegal. He predicted that the US government would have to repay all of them, as was already happening to the 30% “Liberation Day” tariffs imposed last April.
Hale, a Fellow for International Relations, Trade and Economics at the think tank, Advancing American Freedom, noted that the Trump administration did not like “one size fits all” trade preference programmes such as AGOA. He said the administration was seeking to “bully” countries into individual trade agreements.
None of these agreements was binding as they were not endorsed by the US Congress. They would all eventually be ended, by one side or the other, he said.
What happens after 2028? Prof Furchtgott-Roth said US trade policies might be different, whether the new president was a Republican or Democratic party member. A Democratic president would be more amenable to a broader AGOA agreement than a Republican one, she said.
The webinar also looked at how rapid changes in policy complicate things for industries trying to export to the US. South African citrus industry representative Jana Janse van Rensburg said exports worked best when there were long-term agreements – up to 20 years – that gave certainty to producers and importers.
She said the US is an important market, taking approximately 5% of South Africa’s total citrus exports. Other important markets, such as the European Union, were becoming more restrictive, setting phyto-sanitary requirements that could only be met with significant increased costs.
Izaak Breitenbach of the SA Poultry Association (SAPA) said the poultry industry was not an AGOA beneficiary. It had been harmed by an annual quota of US chicken imports free of anti-dumping duties – “this means they can dump” – imposed in 2015. The quota should have been scrapped because it was conditional on benefits to other South African industries which new US tariffs had negated.
Breitenbach said this quota had now been accepted and increased by the South African government in trade negotiations with the US, without any discussion with the poultry industry or the offer of any benefits to counter the negative impact of the US quota.
The poultry industry did not export to the US, but was seeking to expand exports of cooked chicken products to the European Union and the Middle East, Breitenbach said. He noted that South African industries that are AGOA winners should find ways to compensate or support industries who sacrifice for their benefit.