Pres­sure

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Ever more US in­ter­ests are try­ing to use the new and im­proved African Growth and Op­por­tu­nity Act (Agoa) to lever­age pol­icy con­ces­sions out of South Africa, seem­ingly un­de­terred by a “break­through” deal on chicken im­ports in June. An “out-of-cy­cle” re­view of South Africa’s Agoa el­i­gi­bil­ity kicked off in Washington last week with a public hear­ing last Fri­day and a sec­ond round of public sub­mis­sions got pub­lished this week.

The US phar­ma­ceu­ti­cal, in­for­ma­tion and com­mu­ni­ca­tion tech­nol­ogy (ICT) and pri­vate se­cu­rity in­dus­tries have joined in the bet­ter-known US meat-ex­porters’ at­tack on key trade and eco­nomic poli­cies.

In the cross hairs are South Africa’s still-in­com­plete re­form of in­tel­lec­tual prop­erty rules, planned lim­its on for­eign own­er­ship in the se­cu­rity sec­tor and the reg­u­la­tion of elec­tronic waste dis­posal, as well as the latest changes to broad-based BEE score­cards.

In their sub­mis­sions, key US meat ex­porter groups are dis­mis­sive of the chicken quota deal struck in Paris in June, as well as the claimed progress to­wards re­al­low­ing banned US pork and beef prod­ucts to en­ter South Africa, which the depart­ment of trade and in­dus­try had held up as prac­ti­cally en­sur­ing South Africa’s con­tin­ued in­clu­sion in Agoa.

The depart­ment this week replied to its US crit­ics, de­fend­ing its steps on US meat im­ports and the im­por­tance of South Africa’s trans­for­ma­tion poli­cies.

Civil so­ci­ety groups went on a more ag­gres­sive of­fen­sive against the at­tempt to make South Africa back down from the more gener­ics­friendly in­tel­lec­tual prop­erty pol­icy pro­pos­als made in 2013.

The Treat­ment Ac­tion Cam­paign, Doc­tors With­out Borders, Sec­tion 27 and the Stop Stock Outs Pro­ject railed against the at­tempts to lever­age Agoa against these in­tel­lec­tual prop­erty re­forms, which are largely aimed at im­prov­ing the avail­abil­ity of life-sav­ing medicine to treat HIV, TB and other en­demic dis­eases.

Phar­ma­ceu­ti­cal com­pa­nies have anony­mously chan­nelled com­plaints to the Agoa re­view through sub­mis­sions by the Amer­i­can Cham­ber of Com­merce and the Na­tional For­eign Trade Coun­cil. The in­tel­lec­tual prop­erty pol­icy will in­ten­tion­ally “weaken cur­rent stan­dards that are im­por­tant to in­vestors and in­no­va­tors”, they say.

That is cer­tainly the point, but the non­govern­men­tal or­gan­i­sa­tions point out that the pro­pos­als fall well within what is al­lowed un­der South Africa’s com­mit­ments un­der the in­ter­na­tional Agree­ment on TradeRe­lated As­pects of In­tel­lec­tual Prop­erty Rights. It also echoes pre­vi­ous re­forms in other ma­jor de­vel­op­ing coun­tries.

The Amer­i­can Cham­ber of Com­merce chimed in this week, say­ing that South Africa’s new broad­based BEE rules are too oner­ous be­cause of the far higher weight given to lo­cal pro­cure­ment. “For many man­u­fac­tur­ers with com­plex global sup­ply chains, this is an un­re­al­is­tic re­quire­ment and one that can­not be met with­out sig­nif­i­cant ad­di­tional in­vest­ments,” said the cham­ber, ap­par­ently speak­ing mostly on be­half of ICT in­ter­ests.

The in­tel­lec­tual prop­erty pol­icy was also a threat to US ICT im­ports, it said.

These as­so­ci­a­tions are tak­ing a far softer public ap­proach than the US meat lob­bies be­cause their mem­bers ac­tu­ally have in­vest­ments in­side South Africa.

Los­ing Agoa would have a “de­bil­i­tat­ing im­pact on South Africa and ... the abil­ity of Amer­i­can com­pa­nies to do busi­ness in South Africa”, said the cham­ber in its sub­mis­sion.

They don’t want South Africa kicked out of Agoa, but think these qualms can serve as “lever­age for ac­tion/changes in terms of pol­icy is­sues that the South African gov­ern­ment is pur­su­ing”.

In a sub­mis­sion to the Agoa hear­ing, the USA Poul­try & Egg Ex­port Coun­cil and the Na­tional Chicken Coun­cil treat the chicken deal from June with scep­ti­cism, say­ing that “the ball is in South Africa’s court” and that they will “ac­cept noth­ing less” than ac­tual US chicken pieces mak­ing it into South Africa be­fore lift­ing the threat of cut­ting Agoa ben­e­fits.

“It is not enough to have reached an agree­ment in prin­ci­ple in Paris, or to ini­ti­ate var­i­ous le­gal pro­cesses in South Africa,” reads its sub­mis­sion.

The chicken deal would al­low 65 000 tons of US bone-in chicken pieces to en­ter South Africa ev­ery year – free of the puni­tive an­tidump­ing du­ties that have in ef­fect blocked the prod­uct since 2000.

The de­tails for this scheme are still be­ing fi­nalised, but the South African side of the talks claims it is the Amer­i­cans who are drag­ging their feet by not timeously re­spond­ing to the draft agree­ment that has been drawn up.

The US’s Na­tional Pork Pro­duc­ers’ Coun­cil is, how­ever, mak­ing the most ag­gres­sive ar­gu­ment for puni­tive mea­sures against South Africa. This is in re­tal­i­a­tion for the phy­tosan­i­tary re­stric­tions that have prac­ti­cally banned many US pork im­ports for more than a decade.

It called for all Agoa ben­e­fits to be with­drawn to “draw the at­ten­tion of high-level of­fi­cials to the anti-trade poli­cies be­ing en­forced by gov­ern­ment agen­cies”.

De­spite the depart­ment of trade and in­dus­try claim­ing sig­nif­i­cant progress in hashing out a deal on pork, the Na­tional Pork Pro­duc­ers’ Coun­cil claims that there has been “no mean­ing­ful progress”.

It then pro­poses that the US could stop short of to­tally ex­clud­ing South Africa, but in­stead re­voke mar­ket ac­cess for spe­cific prod­ucts, in­clud­ing or­anges, wine and nuts – in essence ev­ery­thing South Africa ex­ports un­der Agoa ex­cept for BMWs ( SMS us on 35697 us­ing the key­word TRADE and tell us what you think. Please in­clude your name.

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