SA sees trade unaffected by US subsidy-preferences loss

South African exports to the US are unlikely to be affected by the Trump administration’s decision to remove the country’s exemption from trade-remedy laws, according to the South African government.

The US last week narrowed its internal list of developing and least-developed countries, including South Africa, China and India, in order to reduce the threshold for triggering a US investigation into whether nations are harming US industries with unfairly subsidised exports.

The implications of the US decision to revise its developing-country methodology “will need further assessment,” South Africa’s Department of Trade and Industry said in a statement on its website. “However, as the South African government does not provide subsidies to industry or agriculture that are illegal under the terms of the World Trade Organization Subsidies and Countervailing Measures, the new US Trade Representative designation should have no direct impact,” it said.

Trade in goods and services between South Africa and the US was valued at $18.9 billion in 2018, with $2.4 billion of exports from South Africa cleared under the so-called Generalized System of Preferences, America’s oldest and largest trade-preference program for the world’s poorest economies, and African Growth and Opportunity Act preferential programs, according to US government data.

South Africa’s preferential market access to the US is under review after the USTR accepted a complaint from the International Intellectual Property Alliance - a private-sector group that represents 3 200 US companies including the makers and distributors of books, films, music and video games - that alleges South Africa’s Copyright Amendment Bill and Performers’ Protection Amendment Bill fail to “provide adequate and effective protection” of U.S. copyrights.

If the outcome of the review is negative, South Africa could lose its preferential market access under the GSP and AGOA, which together allow most sub-Saharan African countries duty-free access to the US market for almost 7 000 products. That could deepen the malaise of an economy stuck in its longest downward cycle since World War II.

ZAR/USD
17.38
(-0.05)
ZAR/GBP
22.72
(-0.10)
ZAR/EUR
20.56
(-0.12)
ZAR/AUD
12.45
(-0.12)
ZAR/JPY
0.16
(-0.19)
Gold
1942.90
(+0.07)
Silver
26.42
(+0.07)
Platinum
941.16
(+0.46)
Brent Crude
44.74
(-0.36)
Palladium
2104.73
(+0.41)
All Share
57077.48
(-0.60)
Top 40
52737.48
(-0.65)
Financial 15
10156.41
(-0.69)
Industrial 25
75107.47
(-0.84)
Resource 10
58926.78
(-0.40)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 1011 votes
It depends on how the funds are used.
74% - 6772 votes
No. We should have gotten the loan elsewhere.
16% - 1429 votes
Vote