Photographer: Kevin Sutherland/Bloomberg

South Africa Says U.S. Deal Reached to Save AGOA Trade Pact

  • Minister expects South Africa won't lose trade benefits
  • Agreement reached on oustanding animal-health standards

South Africa has resolved a trade dispute with the U.S. to retain duty-free access for its farming exports to the world’s biggest market.

The two sides worked out issues related to health standards on American meat exports to South Africa, Trade and Industry Minister Rob Davies told reporters in Pretoria on Thursday. U.S. President Barack Obama said on Nov. 6 that South Africa’s preferential access for farming exports under the African Growth and Opportunity Act would be revoked in 60 days if a deal wasn’t concluded.

South Africa has been under pressure to reach agreement with the U.S. to open its market to American chicken, beef and pork. Products that South Africa exports to the U.S. that would have been affected include fruit, nuts and wine.

The U.S. will consider the deal a success if South African consumers can "buy American products in local stores," U.S. Trade Representative Michael Froman said in an e-mailed statement on Thursday from Washington. "We will be working to ensure that this final benchmark of entry of poultry is achieved so that South Africa continues to have the advantage of full AGOA benefits."

The AGOA accord favors 39 African nations by eliminating import levies on more than 7,000 products ranging from textiles to manufactured items. To remain beneficiaries, countries are required to cut barriers to U.S. trade and investment, operate a market-based economy, protect workers’ rights and implement economic policies to reduce poverty.

The trade program has helped South Africa more than double its exports to the U.S. since 2000. South African agricultural exports to the U.S. under AGOA amounted to $154 million in the first nine months of last year, or about 14 percent of shipments, according to data from the Trade Law Centre, which is based in Stellenbosch, near Cape Town.

“It’s a very positive thing that they have managed to resolve the issues,”
Joseph Cronje, a researcher at the center, said by phone. “The U.S. is becoming an increasingly important market for South African agricultural goods.”

Before it's here, it's on the Bloomberg Terminal.