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SA pinning hopes on US Congress to extend Agoa deal

President Cyril Ramaphosa and Trade and Industry Minister Ebrahim Patel want Agoa to be extended. Picture: Yandisa Monakali / GCIS

President Cyril Ramaphosa and Trade and Industry Minister Ebrahim Patel want Agoa to be extended. Picture: Yandisa Monakali / GCIS

Published Sep 26, 2023


Trade and Industry Minister Ebrahim Patel says the US Congress has not yet set a date on the renewal of the African Growth and Opportunity Act (Agoa), but they are lobbying both the Republicans and Democrats for the extension of Agoa.

Patel said they want Agoa to be extended for another 10 years.

President Cyril Ramaphosa made a similar call on the margins of the UN last week when he called for the extension of Agoa for 10 years when it comes up for renewal in two years time.

But Patel said despite Agoa expiring in 2025, they want an early extension to boost investor confidence in South Africa.

Patel was on Tuesday briefing the joint committees on trade in Parliament on Agoa.

This comes after he and US Trade Representative Katherine Tai confirmed that the Agoa forum will be held in Johannesburg on November 2 to 4.

Patel told members of the National Assembly and National Council of Provinces that they want the preferential trade agreement to be extended and South Africa has benefited a lot over the years.

He said Agoa boosted the country’s export earnings.

He said the renewal of Agoa was in the hands of the US Congress, but South Africa has met with various key members of Congress and senior Biden administration officials to secure Agoa.

“The future participation of Agoa is governed by two processes. Firstly, is annual reviews of eligibility, which countries continue to meet the criteria. The second one is renewal of Agoa beyond 2025.

“The annual reviews is the requirement of Congress that the Office of the Trade Representative conducts an annual review. They can do what is also called out of cycle reviews and they are currently busy with a review and a report is expected in November.

“On the matter of renewal or extension of Agoa, the US Congress has not yet set a date for a decision on the future of Agoa. Given the political divisions in the US Congress, it’s in South Africa’s interest to secure bipartisan consensus in the US to secure the necessary backing. A bipartisan consensus would mean getting the support of both the Democrats and the Republicans in the approach towards Agoa,” said Patel.

He said this was the most important task facing the government.

In the discussions they have had with US Congress members over the last few months, they have been trying to get the deal done.

They met with Tai, national security adviser Jake Sullivan and senator Chris Coons, who chairs the sub-committee on foreign relations.

Coons is one of four US lawmakers who wrote to US Secretary of State Antony Blinken, Tai and Sullivan, calling for the Agoa summit to be moved away from South Africa after the fallout over the Russian ship that docked in Simon’s Town late last year.

But President Cyril Ramaphosa appointed a panel that investigated the allegations that government sold arms to Russia. The inquiry cleared government of the arms sales allegations.

Last week Patel and Tai announced that the summit will go ahead as planned in November.

Patel said they have been working hard behind the scenes that Agoa must be extended for another 10 years.

The preferential trade agreement has been in place since 2000 and it has been extended three times already.

There are over 5,000 products that are under Agoa.

Patel said the relationship that South Africa has with the US was strong and based on sound economic ties.

“I said earlier we value the relationship, it’s an important economic relationship. To promote and expand South Africa and US relationship, a number of steps have been taken. I identified six significant ones. We have had a direct discussions between the heads of state, presidents Ramaphosa and Biden on the strategic relationship and these discussions have taken place over a number of years.

“There has been engagement at ministerial level with the office of the US Trade Representative. Those discussions have taken place from 2019 to 2023 during this administration with a number of meetings. We also had meetings with other Cabinet members in the US like the Secretary of Commerce, the Secretary of Agriculture and the Secretary of State.

“The South African government with Congressional representatives, we have engaged senators and House representatives, both Democrats and Republicans. We have had a South African high-level delegation to the US in July to address economic and geopolitical matters. There has been presidential and ministerial-led engagements with the US private sector. Most recently, the president had a business round table with a number of companies, coordinated with the US Chamber of Commerce and this took place about a week ago,” said Patel.

He said he hoped that Agoa will be extended and the summit will be a good foundation to engage on these issues.

But the government was pinning its hopes on the support from both the Republicans and Democrats in Congress to ensure that the deal was extended.

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