EBieSA, a newly formed association representing about 105 emerging black importers and exporters, yesterday said that the dti was working on an industry master plan, yet it was set to announce its decision on Sapa’s tariff increase application by the end of August based on a recommendation by the International Trade Administration Commission of South Africa.
Unati Speirs, the chairperson of EBieSA, said raising tariffs before the plan was done was putting the cart before the horse and showed that there was no genuine intention to remedy the current industry’s flaws.
“This is not the first plan that Sapa and the dti have collaborated on, and is merely another attempt to shut down the national call to transform this monopolistic industry and to continue with business as usual for another decade,” Speirs said.
EBieSA said Sapa was simply seeking to protect their profits to the detriment of consumers and emerging black importers by retaining this skewed monopolistic structure.
The chicken import tariffs currently stand at 37 percent and the maximum allowed under World Trade Organisation rules is 82 percent. Sapa was not readily available for comment.
But early this year the association, whose members include large companies such as the RCL Foods, Astral Foods and Rainbow Chicken, defended its stance of supporting the import tariffs and said 61 percent of imports that came from Brazil outnumbered the output of even the biggest South African producer.
It said in the past six months half of the small farmers it was in contact with had gone out of business due to the fact that their potential markets had been flooded by ever-increasing volumes of dumped chicken.
Mandla Nkomo, an agri business consultant, and managing director of Solidaridad in South Africa, said South Africa was not ready to eliminate imports through the imposition of a prohibitive 82 percent tariff.
Nkomo said South African producers were only able to produce 70 percent of the chicken required to feed the country’s consumers.
“The remaining 30percent is imported from other countries, except when the South African industry faces outbreaks of avian flu and drought, in which case South Africa has to import more chicken to meet local demand and ensure security of supply. Why destroy the jobs created by imports when local production has not been improved to substitute these imports,” Nkomo asked.
BUSINESS REPORT ONLINE