Banele Ginidza
The Department of Trade Industry and Competition (the dtic) has said the United States' latest shift to reduce tariffs on countries including South Africa to 30% were fertile ground for negotiations.
This comes as South Africa's trade representatives prepare to meet with their US counterparts for a concerted approach to the revision of trade facilitation agreements.
Speaking on Radio 702 on Thursday morning, Tau said the government was planning its engagement and the issues to engage the US about.
Tau said that it was clear the US now wanted only mutually beneficial agreements as it viewed previous tariffs and other structures had been disproportionately skewed in South Africa's favour, along with other countries.
"We had already started raising with the US the need to revise the trade and investment facilitation agreement that we had to normalise trade between the two countries. We would want to build on that, it would include agricultural products," Tau said.
"They have been part of the issues on the agenda and part of the issues in dispute we would include issues of direct investment. We have our multinationals that are invested with the US and certainly the US has about 600 companies that have invested in SA, so we have to look at invetsment opportunities both way."
As South Africa prepares for an upcoming Trade Ministers' meeting in the Democratic Republic of the Congo (DRC) next week, Tau stated that collective discussions will revolve around the African Growth and Opportunity Act (Agoa)—a piece of legislation essential for providing preferential trade access for qualifying African countries.
"We have to make decisions about how that would constitute a nexus of negotiations taking place in June or July this year," he said.
Amidst these conversations, Tau reflected on the complexity of the geopolitical landscape.
With concerns stemming from issues such as foreign investment, broad-based black empowerment, and regional stability, Tau acknowledged the need for South Africa to engage comprehensively with the US, addressing the multifaceted political climate.
"We have to create a degree of certainty. With the levels of uncertainty, it is difficult for investors to make decisions," he said.
Since the formal announcement from the US on Wednesday, interactions with the US Embassy have already taken place, paving the way for more detailed discussions.
"We will seek to engage with the US. There is a queue of requests; we have always said we will seek to engage," he explained, reinforcing the importance of the longstanding trade relationship.
Moreover, Tau did not shy away from observing the US' previous stance on tariffs, suggesting it may have been a strategic ploy to reposition negotiations on their terms. He conceded that while the US aimed for parity in trade agreements, the ultimate goal should be to normalise relations and facilitate a more robust dialogue regarding bilateral trade.
As South Africa grapples with the broader implications of these changes, Tau reassured local markets and investors, indicating that the government was proactive in not only negotiating with the US but also exploring alternative markets globally.
Tau recognised the challenges that will accompany such changes as the need for diversified supply chains grows, acknowledging the long-term strategy required to adjust the current state of affairs.
Tau concluded with a resolute message, stating that a coordinated approach would be vital as South Africa navigates its future trade landscape. Whether through existing ties with the US or fostering new international partnerships, the focus remains on creating an interconnected and resilient trade environment for South Africa.
BUSINESS REPORT