Agoa extended – and SA is included

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JIMMY MOYAHA: The African Growth and Opportunity Act (Agoa) was signed into legislation this week by President Donald Trump.

The signing obviously being the extension of that pact and surprises there, South Africa was left included in that signing. There was no explicit declaration that we are not part of that.

So that means then that from now until 31 December 2026, we are still going to be able to enjoy the benefits of the Agoa agreement.

We’re going to be taking a look at this in greater detail with the manager for the fruit desk at the Agricultural Business Chamber of South Africa (Agbiz), Wolfe Braude. He joins me on the line now to see what we make of this.

Wolfe, lovely having you on the show. Thanks so much for taking the time. Does this really provide relief? A year in the agricultural cycle is hardly anything to be happy about, but I suppose every bit does help.

WOLFE BRAUDE: Jimmy, thanks very much for having me on the show, and good evening to the listeners. Yeah, it does help because we are unfortunately still experiencing the 30% tariff, and that does not fall away, even with this renewal of Agoa. So we still pay 30% going into the US market.

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But where we would have paid 30% plus, let’s say, another 2.5% to 5%, 6.5% for agricultural products, and other sectors would have paid much more, and so on, we’re now back to being zero in most cases under Agoa.

So it is some relief. It’s something at least and it does help because it is a very competitive market.

JIMMY MOYAHA: Now, Wolfe, we know very well that from past experiences, and I refer only to the last 12 months, that Washington and the Oval Office could very quickly change this conversation on its head. It has left our agricultural sector having to find new markets, identify new partnerships and almost not be reliant on this renewal.

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Is that something that we’re likely to see continue, understanding that, of course, we could realistically be right back at this point, this time next year without an agreement?

WOLFE BRAUDE: Yeah. We realised with the 30% and the massive implications of the global shift in the US trade regime. Sixty countries were given high tariffs. The other 100-odd countries were given 10%. We realised the tariff landscape has changed totally with the Americans.

We have no certainty what happens in the next general election with the US, whether there are policy shifts, we don’t know whether the tariffs will be struck down by the Supreme Court, or not.

So, yeah, we are actively pursuing alternative markets. We have been for a number of years.

Slowly but steadily, we’ve been signing protocols for plant health, plant safety into markets, like avos going into China, beef going into Saudi Arabia and so on. That’s really helping because now we can start to build consumer awareness and start to try and build relationships, commercial relationships.

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It does take a few years to develop market presence there and because it’s agricultural products, we can’t shift it as easily as if it was a fridge or something, which you can just plonk in a warehouse, perhaps. No offence to our fridge colleagues, but it’s harder with agri products, so it takes about a season to two seasons to shift to another market.

So yeah, we are definitely looking forward to whatever government succeeds with in the Middle East and East Asia.

JIMMY MOYAHA: Wolfe, let’s take a look at the Agoa agreement. I know from an Agbiz perspective, you were one of the stakeholders involved in trying to see if we could find a middle ground, propose alternatives, being involved with the Department of Trade, Industry and Competition to see how we could best move forward with this.

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Do you think that from what we know about where we stand at the moment, do you think that this is something that we could hopefully hold on to and, hopefully see that this will continue going into next year?

Obviously, I don’t expect you to weigh in on what would happen out of the White House, but was there enough optimism in the conversation to potentially say that maybe the worst is behind us in terms of our relationship with the United States?

WOLFE BRAUDE: It is a very unpredictable situation, and the negotiations are still ongoing between the US and South Africa, and thankfully, there is no cut-off date, and the technical teams are still talking, in spite of what you don’t see on social media and in the media in general.

There are still negotiations ongoing, so we remain hopeful.

We believe that something, let’s say, we settled on 18% to 20%, we believe that would still be a significant step forward compared to 30%.

But our US counterparts and importers and distributors and retailers on the other side are very unhappy with the situation. They really want the tariff removed. They really want access to South African products as they previously had.

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There are still our exports going into the market, it’s just that it’s going to be an unsustainable curve over the next two years at 30%, to be able to retain that.

We are hopeful that perhaps the Supreme Court will strike down the tariffs, and the replacement won’t be as bad, or perhaps there’ll be a change of position or perhaps negotiations will be successful.

But also, those relationships in the US, they took a long time, like half a decade to a decade in some cases – for example, citrus – to build.

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So we have contractual relationships, also we have deep relationships with Americans who we work with there, and we want to honour that.

We are trying to stay in the market for as long as we possibly can. Also, because it’s a solid market, the people are good, there’s a good rule of law, contractual law, they fulfil their end of the bargain.

It’s a very good business environment to be in and market to be. So we are hopeful and we really would like for South Africa to remain part of Agoa. We remain hopeful until we are actually told, be gone. We shall remain hopeful.

JIMMY MOYAHA: We remain hopeful, but we are alive to the realities of the situation we are confronted with, and those realities are ever present. We’ll leave the conversation on that note.

Thanks so much to the manager for the fruit desk at Agbiz, Wolfe Braude, for joining us to take a look at the Agoa extension that does include South Africa.

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