The head of Africa’s largest bank says South Africa’s qualification for preferential trade access to the US market appears to be back on track thanks to improved diplomatic relations between South Africa and Washington, according to a report in Business Day.
Standard Bank group chief executive Sim Tshabalala said the SA government has moved quickly to mend frayed ties with the US following an alleged arms shipment involving a Russian ship which docked in Cape Town earlier this year. The ship’s visit featured in high-level discussions involving officials from both countries, and South Africa appointed an independent probe which has since cleared SA of any wrongdoing.
South Africa and other qualifying sub-Saharan countries enjoy preferential trade access to the US market for many products, including boats, in terms of the African Growth and Opportunity Act (Agoa) which is up for renewal in 2025.
Tshabalala believes South Africa has successfully weathered the diplomatic storm and is now less at risk of losing the Agoa benefit: “In our view, the risk of SA losing Agoa preferences — or of sanctions being imposed — has receded … President Ramaphosa visited both Kyiv and Moscow to encourage negotiations, and senior government representatives visited Washington to clarify SA’s stance,” Tshabalala told the bank’s shareholders in a transcript, Business Day reported this week.
The Western Cape Province is particularly at risk should South Africa lose its Agoa status. The Province is the country’s boatbuilding hub and hopes to expand its international market footprint on the back of solid growth over the past decade. Ebrahim Patel, the Minister of Trade, Industry and Competition, is due to address the Agoa matter during a special parliamentary briefing scheduled for September 26th.
Patel and other senior South African officials have requested the US grant an early Agoa renewal ahead of the 2025 deadline in the hope of shoring up the trade deal benefit. The request was made in July during a high-powered mission the US.