433369666-The-Case-for-Investing-in-South-Africa

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TRADE POLICY: MAIN BENEFITS OF SELECT
TRADE AGREEMENTS
Southern African Development Community (SADC) FTA:
• Import market of USD196.5-billion in 2018.
• SADC incorporates 16 member states, namely, Angola, Botswana, Comoros,
Democratic Republic of Congo, eSwatini, Lesotho, Madagascar, Malawi, Mauritius,
Mozambique, Namibia, Seychelles, South Africa, United Republic of Tanzania,
Zambia and Zimbabwe.
• Since 2012, the SADC FTA has allowed for duty-free trade among 12 of its members.
• The SADC FTA encourages intra-regional trade, investment and regional value chain
development.
African Growth and Opportunity Act (AGOA):
• Increased the number of products entering the United States (US) market duty-free
under the General System of Preferences (GSP) by more than 1 800 products for
African countries.
• Improves market access for African products into the USD2.6-trillion (2018)
US import market.
• Encourages intra-African trade through recognition of African inputs for rules-of-origin
purposes.
• African countries do not have to reciprocate by opening up their markets to US
products.
• In 2018, USD1.5-billion worth of US imports from South Africa (17.5% of total US
imports from SA) entered the country under AGOA, with more than 1 800 African
products able to enter duty-free under GSP.
South Africa-European Union Trade and Development Co-operation Agreement (SA-EU TDCA):
• Duty-free access to part of the EU market (overall imports from the world at large amount to about €1.8-trillion).
• Covers 90% of bilateral trade between the EU and South Africa.
• Established as an asymmetrical agreement, with the EU opening up its market faster than South Africa.
• The EU liberalised 95% of its duties on South African-originating products by 2010.
• Covers the liberalisation of trade in goods and services plus the free movement of capital.
• Normally protected agricultural goods in the EU are part of the agreement (with some exclusions).
European Union-Southern African Development Community Economic Partnership Agreement (EU-SADC EPA):
• Will replace the SA-EU TDCA once ratified by the two parties.
• The agreement offers improved market access relative to the EU TDCA.
• EPAs are permanent in nature and incorporate development aid from the EU.
• The EU’s Aid for Trade helps partner countries improve customs procedures and reduce paperwork.
• EPA partner countries export to the EU market free of duties and import quotas.
• EPA supports partner countries to meet high EU standards in food safety, animal and plant health.
• One-stage processing in manufactured goods is sufficient to qualify for duty-free entry.
• EPAs promote regional value chains; one country can process inputs and still benefit from duty-free access to
Europe.