International relations minister Naledi Pandor has urged the US government to waive its four-year-old tariffs on imported metals.
President Donald Trump imposed the section 232 tariffs affecting SA steel in March 2018, saying the move was aimed at protecting the US steel industry. The tariffs added a 25% fee to steel and a 10% fee to aluminium imported to the US. Canada and Mexico were exempt.
SA is one of Africa’s largest steel producers. According to the World Steel Association, SA steel manufacturers produced 5.7-million tonnes of crude steel in 2019, second on the continent only to Egypt.
In 2020, SA exported $344.6m worth of steel and $324m worth of aluminium to the US, per the UN Comtrade database on international trade.
Two-way trade
Pandor, who met the US secretary of state Antony Blinken at the international relations & co-operation department in Pretoria on Monday, said SA is driving investment with the US.
She said two-way trade in goods grew from $13.9bn in 2010 to $21bn in 2021. SA is Africa’s biggest exporter to the US, and in 2021 the US was the country’s second-largest destination for SA exports.
“A good start in this vein will be to speedily resolve the long-standing unresolved trade issues around market taxing, including the removal of section 232 tariffs of SA steel and aluminium imports into the US,” Pandor said.
Pandor and Blinken had not agreed on a firm undertaking by the end of Monday’s “strategic dialogue” in Pretoria.
“The US still has a future in our country and an interest in our future and the value proposition that we offer as a key investment destination and trade partner,” she later added.
In the four years since the announcement of the section 232 tariffs, the US has reduced them in several countries. In March 2022, the US and UK agreed to replace the tariffs on steel and aluminium from the UK with tariff rate quotas allowing up to 500,000 tonnes of UK steel and 12,300 tonnes of UK aluminium to enter the US duty free annually. Imports over these amounts are still subject to the 25% and 10% fees, respectively.
In February 2022, the US announced a new agreement with Japan in which it can ship up to 1.25-million tonnes of steel to the US annually without being subject to the 25% additional tariff. But the agreement did not change the 10% section 232 tariff on Japanese aluminium.
The significant presence of US companies [in SA] has helped up-skill our young people, create jobs, livelihoods and has made the US private sector a key partner in supporting SA’s socio-economic growth
— Naledi Pandor, Minister of international relations and co-operation
In October 2021, the US announced it would lift the tariffs on a set volume of steel and aluminium products imported from the EU. This was in return for the removal of retaliatory EU tariffs on US goods.
Welcoming Blinken, Pandor called the US “one of SA’s most valued partners” in President Cyril Ramaphosa’s drive for economic recovery and foreign investment, particularly after the Covid-19 pandemic.
“The significant presence of US companies operating within our borders including historical, long-term investors such as General Electric and Ford to name just two, has helped upskill our young people, create jobs, livelihoods and has made the US private sector a key partner in supporting SA’s socioeconomic growth,” she said.
Blinken’s next stop on his SA leg of an African tour of three countries was the University of Pretoria, where he gave a speech on US-Africa relations. He was scheduled to join SA’s Women’s Day commemorations on Tuesday.
Later this week, he will visit the Democratic Republic of the Congo (DRC) and Rwanda.
Russia’s aggression in the Ukraine was the subject of discussions between Blinken and Pandor, with both parties holding their respective lines.
Ramaphosa and President Joe Biden of the US agreed on four focus areas for the bilateral talks during a call before Blinken’s visit: health, climate change, trade and investment and industry. Blinken said the composition of the US delegation, including diplomats and White House personnel, demonstrates how important SA is to the US.
Listen to the audio of opening addresses from Pandor and Blinken above and below.
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