Negotiations Continue on Poultry Exports to South Africa as U.S. Withholds AGOA Action

The Office of the U.S. Trade Representative is apparently holding off on terminating duty-free benefits provided to South African agricultural goods under the African Growth and Opportunity Act (AGOA), after a months-long meat trade dispute dragged past President Barack Obama’s Dec. 31 deadline for resolution. South Africa Trade and Industry Minister Rob Davies said during a Jan. 5 press conference (here) that negotiations between the U.S. and South Africa are still ongoing. U.S. and South African veterinarians are scheduled to meet Jan. 6 over salmonella tolerance for American poultry exports to the country and Davies said he is optimistic the two sides could reach an agreement by Jan. 8.

The U.S. pressured South Africa to remove trade remedies and sanitary and phytosanitary barriers for several months (see 1509140023), and industry groups like the U.S.A. Poultry and Egg Export Council (USAPEEC) expressed support for suspending AGOA benefits for South Africa to counteract antidumping duties and expand trade flows. To help ease restrictions on U.S. poultry, South Africa on Dec. 18 announced a quota of 65,250 metric tons to be placed on bone-in chicken imported from the U.S., without requiring payment of antidumping duties (see 1512220022), but USAPEEC refused to participate in the measure until the countries agree on provisions of the health certificate for U.S. poultry exports to South Africa. USTR did not comment.

Davies said salmonella tolerances and detection was the principal point of negotiation in ongoing talks, adding that Pretoria is awaiting response from Washington on the matter. “We’re in extra time, but the whistle as of this moment hasn’t been blown, and we’re hoping that the whistle won’t be blown to give our veterinary authorities on both sides an opportunity to engage again,” he said. If imposed by the U.S., termination of AGOA for South African agricultural products would be "a partial exclusion of AGOA benefits for a certain period of time, and if we still did not find a solution, that would be ramped up, it’s our understanding,” Davies said. “But we’re also told that if there is a partial exclusion, and then we do reach an agreement, there can be a very quick reversal of any orders which may be arising at that time.”

Davies’ words come amid criticism from the Association of Meat Importers and Exporters (AMIE) of SA, which in a statement urged the two sides to broker an agreement, and knocked the SA Poultry Association for its “insistence on unreasonable and extraordinary measures” to protect the “uncompetitive local industry, while constantly demonizing American poultry, which is already subject to more stringent testing than [South African] products.” AMIE claimed the “protectionist” practice has jeopardized $2 billion worth of exports and thousands of local jobs amid the harshest economic climate in South Africa since 1994.

“We are aware that certain parties are pointing fingers at the [United States] for the negotiations failure, but we believe that there are aspects to this breakdown which go far beyond one party,” AMIE said. “In any event, AGOA is a unilateral trade preference agreement in the hands of the Americans. It is regrettable to note that an agreement was reached in principle in the first week of June between [South Africa] and the US, yet seven months of further unnecessary delays and last minute brinkmanship appears to have scuppered an agreement for wholly unnecessary reasons.”