While agriculture stakeholders such as Citrus Growers’ Association of Southern Africa (CGA) have welcomed the extension of African Growth and Opportunity Act (Agoa) to 2028, it falls short of the 15 years that South Africa was hoping for and trade certainty remains clouded by other tariff risks.

The US implemented a new 12.5% tariff on a wide range of South African imports on July 24 owing to “slave labour” concerns, which think tank Advancing American Freedom trade expert and international relations fellow Andrew Hale says is another one of US President Donald Trump’s suite of illegal tariffs being imposed on countries all around the world.

He affirms that Trump’s Liberation Day tariffs, forced labour tariffs and new tariffs against Canada are all illegal and did not follow due approval process, with the US having recorded massive losses in providing refunds as a result of tariffs being declared illegal by the courts.

“Countries are developing supply chains away from the US, including the EU, as they want more reliable trading partners and not to be at the mercy of these situations,” Hale notes.

Nonetheless, US lawmakers are worried that South Africa works too closely with countries such as Russia and China and have therefore initiated the US-South Africa Bilateral Relations Review Act as a proposed law that requires a full check of ties between the US and South Africa. The law may allow the US government to consider sanctions against certain leaders.

Hale notes that any bilateral agreements reached with the US may well be nonbinding once Trump leaves office and that many trade deals at the moment are “largely performative messaging” that will be forgotten.

Hale also suggests that South Africa can advance bilateral negotiations with individual US states, since these matters often escalate to federal level and create support for legislative change.

George Washing University adjunct professor and University of Free State's Professor Diana Furchtgott-Roth agrees that some of Trump’s initiatives are certainly outside the bounds of legality and suggests that a new Democratically-elected US President may be more amenable to a broader Agoa relationship with South Africa; it remains to be seen.

LOCAL CONTEXT

CGA market access liaison Jana Janse van Rensburg says citrus is the third-largest export by value under Agoa, which makes it a valuable regime to retain, however, there is extreme uncertainty about South Africa’s continued bilateral trade relations with the US.

“Our citrus production is growing and exports will continue servicing US buyers because those relationships took years to build and are difficult to regain once lost. We need to remain competitive regardless of all the curveballs thrown at us,” Janse van Rensburg states.

She emphasises that trade uncertainty impacts the entire citrus value chain and can influence investment decisions to expand orchards. “We need to protect our Agoa eligibility and maintain US cold chain requirements, while continuing with diplomatic discussions to get the 12.5% tariff out of the way.”

Janse van Rensburg points out that although the US only accounts for 5% of South Africa’s citrus exports, it is a mainstay market for many producers in the Western and Northern Cape. In fact, only fruit grown in these provinces are permitted for export to the US owing to strict biosecurity regulations and citrus black spot restrictions applying in other provinces.

The South African citrus industry exports to 120 countries worldwide, with CGA believing that no product should depend on any single market. “Our success depends on both protecting access to established markets such as the EU and US, as well as securing growth in new ones,” Janse van Rensburg states.

She says predictable market access is imperative since farmers make long-term investments and exporters negotiate multi-year supply relationships. “It creates costs and risk throughout the value chain when trade suddenly becomes uncertain.”

South African Poultry Association CEO Izaak Breitenbach mentions how any future bilateral trade agreements must give due regard to what industries are sacrificed in favour of others.

He cites the example of Agoa having afforded the US tariff-free access to South Africa’s market for up to 65 000 t of poultry meat as part of the negotiations, which is a duty-free regime still enjoyed by the US despite the prior Agoa agreement having lapsed in September last year and despite Trump’s various tariffs having been imposed against South Africa in the meantime.

This while South African poultry has received no meaningful US export benefit.

Breitenbach warns that South Africa needs to “play the longer game” in terms of what it wants to achieve with Agoa and influence bilateral negotiations to the extent where if one industry is sacrificed at least another one benefits.

The experts took part in a webinar discussion hosted by nonprofit anti-unethical trade movement FairPlay on September 10.