International Trade and Investment Click to edit Master title style - - PowerPoint PPT Presentation

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11/25/2016 1

International Trade and Investment

Agbiz Media Day 25 November 2016

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11/25/2016 2

Outline

• Half year 2016 Agricultural Export Performance
• Rebates: South Africa’s poultry imports from USA
• The SACU(M) Economic Partnership Agreement

(EPA)

• SACU-MERCOSUR Agreement
• Outlook for 2017

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Agricult ltural l Trade Performance

• 0,2

0,4 0,6 0,8 1,0 1,2 1,4 1,6 1,8 2,0 Africa EU (28) Asia Middle East Americas Black Sea Exports (US$ billion) 2016 2015

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11/25/2016 4

Agricult ltural l Trade Performance

• 0,2

0,4 0,6 0,8 1,0 1,2 1,4 1,6 1,8 2,0 Africa EU (28) Asia Middle East Americas Black Sea Exports (US$ billion) 2016 2015

• 2%
• 12%
• 20%

+11% +8% +3%

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11/25/2016 5

Tariffs, rebates and tr trade remedies:

South Africa’s bone-in in poult ltry ry im imports fr from th the USA

393 2 299 6 906 807 1 238 2 398 1 467 239 645 R0,00 R2,00 R4,00 R6,00 R8,00 R10,00 R12,00

• 1 000

2 000 3 000 4 000 5 000 6 000 7 000 8 000 Jan Feb Mar Apr May Jun Jul Aug Sep Price (Rand/Kg) volume (Tons) Volume (Tons) Price (R/KG)

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11/25/2016 6

Tariffs, rebates and tr trade remedies:

South Africa’s bone-in in poult ltry ry im imports fr from th the USA

393 2 299 6 906 807 1 238 2 398 1 467 239 645 R0,00 R2,00 R4,00 R6,00 R8,00 R10,00 R12,00

• 1 000

2 000 3 000 4 000 5 000 6 000 7 000 8 000 Jan Feb Mar Apr May Jun Jul Aug Sep Price (Rand/Kg) volume (Tons) Volume (Tons) Price (R/KG)

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Tariffs, rebates and tr trade remedies:

South Africa’s bone-in poultry im imports from the USA

9 598 4 442 2 351 6 652 11 808 13 899

• 2 000

4 000 6 000 8 000 10 000 12 000 14 000 16 000 Q1 Q2 Q3 Volume (tons) Actual Exports Unfilled Quota

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11/25/2016 8

EU Economic ic Partnership ip Agreement

Agreement was provisionally implemented on 1st November 2016. New market access

• Wine quota increased to 110 million litres
• 50 million litres for bulk exports
• 77 million litres for bottled wine
• Sugar cane quota increased to 150,000 tons
• 50,000 tons of refined sugar
• 100,000 tons of cane sugar for refining
• Tariff phase down for sweet oranges from 16th Oct – 31st Nov over

the next decade – ensuring duty free market access by 2027

• Pears of variety Nashi and apples other than cider apples subject to

duty free window period – 1st May to 31st June

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11/25/2016 9

EU Economic ic Partnership ip Agreement

Poultry

• Reports received suggest that there has been an outbreak of Avian

Flu in Denmark, Netherlands, Poland and other parts of Europe.

• However, this is only on wild flocks, which means an automatic ban

cannot be implemented as yet.

• Avian Flu-related Bans have already been in place against France and

recently introduced against Germany

• Minister Davies is expected to implement a safeguard that will

translate into a 13,4% duty on poultry imports from the EU.

• SAPA argues that this will not be enough to avert the danger paused
• n unfairly priced imports from certain EU countries.

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Economic Partnership ip Agreement

Citrus

• CBS emergency measures on South African citrus into the

EU will remain a critical issue in 2017

• The citrus industry is incurring R1 billion per annum in

compliance costs to manage CBS

• Emerging issues of False Coddling Moth will add to the cost

burden and it is going to adversely affect competitiveness.

• Strategic diversification into Asia and the Far East will is

expected as South Africa attempts to avoid high non-tariff barriers in the EU

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11/25/2016 11

SACU-MERCOSUR Agr greement

• Agreement implemented on 21st October 2016 after it was supposed to

come into force on 1st April 2016 Duty import reduction on soybean oilcake

• A 1.65% reduction in the import duty on MERCOSUR-originating soya oilcake

imports, after falling from 6.6% to 4.95%.

• The agreement will be implemented retroactively – meaning that duties paid

between 1st April and 21st October will have to be reimbursed by SARS. Quotas

• Meanwhile, quota allocations made for frozen beef cuts – Paraguay and

Uruguay (250 tons, each)

• Quota allocation for soybean – Paraguay (10,000 tons) and Uruguay (6,000

tons)

• Quota allocation for Paraguay soybean (5,000 tons) and sunflower oil (4,000

tons)

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Outl tlook for 2017

• A recovery of domestic production will inevitably lead to a return

to an increase in agricultural exports, particularly maize.

• We do not expect that AGOA will be repealed by the Senate, but

we can never be sure what the out-of-cycle review brings.

• Continued engagement for AGOA reciprocity will continue, in one

form or the other.

• Exports to the EU will likely grow, supported by the new EPA

market access for agricultural products. However, export growth will be threatened by emerging SPS restrictions for citrus – (FCM issues).

• Brexit negotiations will likely commence, and this will add a bit of

uncertainty.

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Thank you

www.agbiz.co.za