Agoa stalemate threatens citrus industry

IOL pic sept17 citrus oranges REUTERS File picture

Cape Town – The citrus industry in the Western and Northern Cape provinces was facing stifled job growth if South Africa was excluded from the United States African Growth and Opportunity Act (Agoa), the Citrus Growers Association (CGA) said on Tuesday.

“Fifty thousand tons of citrus fruits (oranges, mandarines etc) are exported (from South Africa) to the US every year. The US market consists of 25-30% of exported citrus products,” said Piet Smit, the CGA’s Western Cape vice-chairman.

Smit said that in real terms this amounted to about US$65-70 million.

“We are dependent on American markets, it’s our biggest export,” he said.

“There are 250 farms/production units in the Western and Nothern Cape. Collectively they employ 10 000-12 000 workers. Sixty thousand people are also dependents.”

Smit said that without Agoa, profits and future job creation for the industry was bleak.

Although there were growing concerns over the possible loss of jobs, Smit remained positive.

“I don’t think there will be job losses. But there might not be job creation in the future,” he said.

“We want to grow at 10% each year, and this could have a cost.”

If South Africa is excluded from Agoa, it loses its duty-free access to the US market, meaning it would have to pay levies on all agricultural goods exported to North America.

“This would give other countries with free trade agreements an advantage, such as Chile,” said Smit.

Even if South African farmers had to pay a levy, Smit was certain SA would continue to export to the US.

“I am sure we will be in the US,” said Smit.

“The exchange rate will also help us a bit. Nothing has yet been finalised, we’re still hopeful.”

He said that if it came to the country losing its free trade agreement, the effects on the local citrus industry would not be immediate.

“We have three to four months before we start harvesting our exports for the US,” said Smit, who added that this would allow crucial time to explore other avenues.

“We will plan for other markets,” said Smit, “including the Far East. But we will still send to the US, because we need the market.”

Smit further believed Rob Davies, the SA Minister of Trade and Industry, would still find a solution.

“I’m confident that Mr. Davies will succeed,” said Smit. “We are dependent on him to solve the problem.”

Davies and the SA government was still in talks with the US to resolve outstanding issues which have prevented the signing of the extension of the Agoa benefits.

South Africa missed their Monday deadline to remove the barriers stopping imports of beef, pork and chicken from the US. Imports of US meat products was stopped due to health concerns.

At a media briefing in Pretoria on Monday, Davies confirmed that the issues surrounding pork imports had been “concluded” but that the main outstanding matter was around the bacterial disease Salmonella.

Davies had said: “As we sit now, we recognise that we are in extra time. We are past full-time but the whistle at this moment hasn’t been blown. We are hoping the whistle will not be blown to give our veterinary authorities, on both sides, an opportunity to engage again.”

He said the negotiating teams’ next meeting was scheduled for Wednesday, January 6.

African News Agency

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