5 August 2014
President Jacob Zuma on Monday asked for the support of American business to ensure that South Africa does not get excluded from Agoa, the preferential trade programme that was enacted in 2000 to boost and diversify African trade with the US.
Addressing a US-South Africa Business Investment Forum organised by the US Chamber of Commerce in Washington, Zuma said that for Africa to continue to prosper, South Africa had to demonstrate strong growth.
Zuma’s speech comes as US lawmakers prepare to vote on the extension of the African Growth and Opportunity Act (Agoa), whose current term comes to an end next year.
There has been intense lobbying by some in the US to remove South Africa from the list of countries that benefit from the Agoa programme if the legislation is extended next year.
US Trade Representative Michael Froman hosted an Agao forum at the Washington offices of the World Bank on Monday to discuss the scheme, and the US-Africa Leaders’ Summit is expected to address the topic of Agoa’s extension on Wednesday.
Zuma told an audience of leading US business people that South Africa’s economic growth was linked to that of Africa as a whole and that it would be a mistake to exclude South Africa from the programme.
“That is why we put great emphasis in developing not only our country’s infrastructure, but that of the African continent too.
“Agoa has transformed the economic landscape for many African countries and South Africa. It is the cornerstone of trade relations between the US and sub-Saharan Africa.”
He said the programme had greatly enhanced trade between the US and South Africa. Almost 95% of South African exports receive preferential treatment under Agoa.
“We advocate the renewal of Agoa for another 15 years, with the inclusion of South Africa. We strongly believe that by endorsing the extension of Agoa, the US will be promoting African integration, industrialisation and infrastructure development.
“We look forward to positive discussions at the Agoa ministerial forum today and in other forums this week.”
US Chamber of Commerce president Thomas Donohue said South Africa had undergone massive transformation over the past 20 years and that the US was keen to continue to invest in Africa’s biggest economy.
Last year, US exports to South Africa totalled about US$7.3-billion, while South African exports to the US were around $8.5-billion.
“Infrastructure investment is on the rise, manufacturing is growing, tourism is booming. South Africa remains our commercial and strategic partner,” Donohue said.
Business Unity South Africa president Jabu Mabuza told the gathering that despite the recent labour unrest in the mining sector, business in South Africa still considered the country’s economy as stable.
Mabuza, who rose from humble beginnings as a taxi driver to run one of the largest hotel and leisure groups in the southern hemisphere, said South Africa remained an ideal place to do business in Africa, but that there was a need to “fix” the relationship between employers and employees.
“Business needs to rethink the way it relates to employees. We need to rebuild trust and engage with our employees directly and make them understand the costs we face and the choices that have to be made.”
Also present at Monday’s event were South African mining magnate Patrice Motsepe, Pamodzi Investment Holdings CEO Ndaba Ntsele, and Massmart chairperson Mbuseni Dlama.