There is an increasing realisation that trade relations around the world are changing, and participation in AGOA could be nearing an end
With South Africa’s citrus industry now in the final stages of preparation ahead of the 2025 season, growers and exporters to the US are increasingly worried that the advantages they now enjoy under the AGOA agreement are under severe threat.
The latest development in the relationships between the two countries is the expulsion of South Africa’s ambassador to the US, Ebrahim Rasool, from the country with immediate effect.
This has caused much debate in South Africa, but weekend reports indicated that the country will seek a replacement as soon as possible and put the controversy behind it.
There is not much appetite in South Africa to let the matter drag on – partly because it is generally accepted that the ambassador contributed to his own downfall.
Although participation in AGOA has been extended to the end of the year, the country fears the Trump administration could at any time end South Africa’s involvement.
South Africa’s automotive and agriculture sectors are seen as areas of the economy that will be severely affected.
Observers noted that US policies had become ”unpredictable” and were not helping stable trade development.
The South African fresh produce sector has in recent times preferred to keep a low profile. However, during the past weeks industry leaders have become more outspoken.
According to the Citrus Growers Association (CGA), at last week’s South African citrus industry meeting the view was that the EU’s politics were shifting to the right, while at the same time the bloc has been forced to become more unified in facing shared threats.
“All these factors have implications for market access, and in the case of South Africa, continued access to the USA market through AGOA is threatened,” the weekly CGA report to growers noted.
“South Africa must diversify market access for its citrus and seek opportunities offered by BRICS+ countries, whilst also improving access through better tariff regimes,” it continued.
”EU market access remains challenging due to the maintenance of unnecessary measures against CBS (citrus black spot) and FCM (false codling moth).
“We need to match a time of flux with different thinking about new markets and new opportunities,” CGA added.
Hortgro’s CEO Anton Rabe also recently told deciduous fruit growers that the world in which they operated had fundamentally changed, with a few clear lines that had been drawn in the sand.
“Continued ideological rhetoric will however get us nowhere,” he said. ”As a country, we must adapt and find compromises and middle ground based on common sense and economic realities.”
“!f South Africa is kicked out of AGOA, which I believe will happen, it will have serious economic implications in several sectors, including agriculture.
“The short-term impact on our industry (deciduous fruit) will be small, although every cent counts,” Rabe outlined. “The ±R6mn we will pay more in additional duties is immaterial in the bigger scheme of things, but the diplomatic fall-out would be major.
“Somehow, we will have to broker an alternative trade deal, to the benefit of both South Africa and the United States,” he added.
”The reality is that trade with the USA is not a one-way street. Both countries will be poorer without some or other win-win trade agreements in place.”
