Efforts by some US legislators to have the African Growth and Opportunity Act (Agoa) forum moved from SA have failed after the two countries agreed to hold the trade summit in Johannesburg in November.
The confirmation was made by US trade representative Katherine Tai and trade, industry & competition minister Ebrahim Patel on Wednesday following a meeting on the sidelines of the UN General Assembly in New York. The forum will be held from November 2 to 4.
“The forum will bring together the governments of the US and Agoa-eligible countries, as well as representatives from key regional economic organisations, the private sector, civil society and labour,” a joint statement said.
This puts to bed fears that the forum will be moved from SA after a request in June by a bipartisan group of US legislators to secretary of state Antony Blinken, national security adviser Jacob Sullivan and Tai that the forum be held in another country.
The legislators pointed to SA’s perceived closeness to Russia in its war with Ukraine as the reason behind the request.
US-SA trade relations came under pressure after Washington accused SA of providing weapons to Russia in its war on Ukraine, a charge Pretoria has denied. An inquiry commissioned by President Cyril Ramaphosa into the matter cleared SA of any wrongdoing.
Beneficiaries of Agoa are prohibited from engaging in activities or implementing policies that undermine US national security interests.
“Agoa has helped to promote the export of African goods to the US, and we believe there is scope to deepen its impact on African industrialisation,” said Patel.
“An extension of Agoa beyond 2025 will promote inward investment in Africa and provide benefits to both the US and African countries. It will also support our efforts to increase growth through the African Continental Free Trade Area that will cover 54 countries and 1.4-billion people.”
Tai said: “The Agoa forum is an opportunity for the US to build upon the success of the Africa Leaders Summit and further our economic partnership with Agoa countries.”
In 2021, the US was ranked the second-largest destination for SA’s exports globally after China, followed by Germany and third in terms of source of imports after China and Germany. During the same year, trade between SA and US peaked at $21bn. Agoa provides preferential access for about 20% of SA exports to the US, or 2% of SA exports globally.
As the US is one of SA’s largest trading partners, any negative shift in trade relations between the countries would have a devastating effect on the local economy as the country battles an electricity crisis that is hampering its growth prospects.
The forum also provides an opportunity for SA to retain the preferential trade benefits, which are set to expire in 2025.
Union federation Cosatu, which earlier this year made its submissions to the US trade representative in a bid to keep SA as an Agoa beneficiary, said the forum will include the participation of labour organisations from beneficiary countries.
“A renewed Agoa needs to include provisions to support compliance with good labour practices and penalise employers who flout labour laws,” Cosatu spokesperson Matthew Parks said.
“While the federation supports SA’s continued membership of Agoa, it is important our nonaligned role be strengthened. It is critical government and business simultaneously expand trade and investment with other large ing trading partners such as the EU, China, Japan, India, Brazil and, most importantly, the African continent.”
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