SOUTH AFRICAN FARM­ERS PLAY CHICKEN WITH TRUMP TAR­IFFS

For years, the two coun­tries have fought over poul­try: Wash­ing­ton has kept South African poul­try out on health and san­i­ta­tion grounds while Pre­to­ria ac­cuses US farm­ers of dump­ing chicken at be­low-cost prices and has im­posed tar­iffs.

Times of Oman - - FEATURE -

Dump­ing dis­pute

When Pre­to­rius set up his first chicken coops 27 years ago, he said com­pe­ti­tion from for­eign im­ports wasn’t an is­sue.

Trade Min­is­ter Davies said when the White House an­nounced tar­iffs of 25 per cent on steel and 10 per cent on alu­minium this year claim­ing im­ports threat­ened its na­tional se­cu­rity, Pre­to­ria sought an ex­clu­sion.

South Africa’s steel and alu­minium ex­ports to the United States last year were worth more than $650 mil­lion, ac­cord­ing to South Africa’s Trade Law Cen­tre.

But since they con­sti­tuted just one per cent of US steel and a lit­tle over one per cent of its alu­minium, they rep­re­sented no threat to the United States, South Africa ar­gued.

“We were just told that we were out. We were not go­ing to be con­sid­ered for ex­emp­tion. The tar­iff was go­ing to ap­ply to us,” Davies said.

Now that SAPA has filed a law­suit to force a sus­pen­sion of the poul­try quota, the South African govern­ment finds it­self in an awk­ward po­si­tion. If the anti-dump­ing tar­iff is reap­plied, South Africa risks re­tal­i­a­tion from Wash­ing­ton which could have a more far-reach­ing im­pact on the econ­omy as a whole.

The USAPEEC’s Sum­ner told Reuters his group would lobby the US govern­ment to take ac­tion if the quota is re­voked over the metal tar­iffs.

“It has ab­so­lutely noth­ing to do with poul­try trade be­tween the US and South Africa,” Sum­ner said. “SAPA is try­ing to be op­por­tunis­tic here and to in­crease trade fric­tions un­nec­es­sar­ily.”

South African meat im­porters also op­pose any sus­pen­sion of the quota. They say it would push up prices for con­sumers and could pro­voke Wash­ing­ton’s wrath.

“It’s quite pos­si­ble the Trump ad­min­is­tra­tion would take South Africa on,” said David Wolpert, CEO of the As­so­ci­a­tion of Meat Im­porters and Ex­porters of South Africa.

The form of any pos­si­ble US re­tal­i­a­tion is un­clear for now.

“We can­not spec­u­late on what South Africa may or may not do with re­spect to its tar­iffs and non-tar­iff bar­ri­ers,” a US State Depart­ment of­fi­cial wrote in re­sponse to Reuters’ queries. But an­a­lysts and South African of­fi­cials worry the coun­try’s AGOA ben­e­fits may be in dan­ger, again.

Wash­ing­ton used the threat of a with­drawal of AGOA ben­e­fits to press Kenya, Uganda, and Tan­za­nia to roll back tar­iffs last year on sec­ond-hand cloth­ing from the United States. Rwanda re­fused and its AGOA ben­e­fits were cur­tailed in July.

A blan­ket sus­pen­sion of South Africa’s AGOA sta­tus would hit the trans­porta­tion equip­ment in­dus­try hard­est. About 85 per cent of its nearly $1.4 bil­lion in ex­ports to the United States were cov­ered by AGOA last year.

Ul­ti­mately, with le­gal ac­tion pend­ing, the South African govern­ment’s hands may be tied. And de­spite the broader eco­nomic im­pli­ca­tions, South Africa’s poul­try in­dus­try is stand­ing firm. “We agreed some­thing to ben­e­fit the South African in­dus­tries. And that ben­e­fit has been taken away ... We just want what’s fair,” SAPA’s Stander said.

— Reuters

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