COSATU welcomes the Government led delegation to the United States on AGOA
19 July 2023
The Congress of South African Trade Unions (COSATU) welcomes the government led delegation last week to the United States (US) in support of South Africa’s continued retention under the African Growth and Opportunities Act (AGOA). The delegation included the Ministers for Trade, Industry and Competition; Finance and the Presidency and senior leaders from business and COSATU. The composition of the delegation reflected the unity of government, labour and business in support of South Africa’s membership of AGOA and the importance we attach to growing the economy and slashing unemployment. The delegation engaged with key leaders of the US government, Congress, trade union movement and business.
South Africa, like all nations in this globalised era, is dependent upon trading with other countries. Key trade and investment partners for South Africa include the world’s leading economies, in particular the US, the European Union and China. AGOA has had a positive impact upon not only South Africa but the continent as a whole. AGOA provides reduced tariff access to large volumes of South African goods to the US market, currently still the world’s largest economy. Our mining, manufacturing and in particular auto-manufacturing, clothing, jewellery and agricultural exports have benefited from this favourable tariff regime.
AGOA is renewed annually and extended for 5-year terms. South Africa’s retention is currently subject to review as its current membership expires in 2025. Not only do US companies investing locally support directly and indirectly 600 000 South African jobs; but even more local jobs in the mining, manufacturing and agricultural sectors benefit from our large volumes of exports to America. The revenues and taxes they generate contribute towards government’s fiscus and thus its ability to fund badly needed public services and jobs. The majority of these workers are members of COSATU Affiliates.
COSATU’s mandate is to protect workers’ jobs and to tackle unemployment. We cannot afford a single job loss with an unemployment rate of 42.6% and when 62% of young people struggle to find work. The Federation has been deeply distressed by statements by some politicians who have sought to politicise trade relations with the US and threaten South Africa’s exit from AGOA. Workers should not be punished because of geo-political crises in the world that they have nothing to do with or little power to resolve.
The crises affecting world peace need to be resolved by calm minds. The Federation supports President Cyril Ramaphosa’s pragmatic efforts to support a peaceful resolution to the current conflict between Ukraine and Russia. All wars require negotiations to bring them to an end. South Africa’s hard-won history of non-alignment and negotiations to end often intractable conflicts achieved not only our democratic breakthrough in 1994 but also helped bring peace to numerous other crises and conflicts from Lesotho to Comoros, Congo, South Sudan, Ethiopia and Eritrea, and even as far afield as Haiti and Northern Ireland. Few other countries are able to reach out to both parties in the Ukraine Russia conflict.
AGOA has been important not only to South Africa’s industrial development but also to those of other African states, in particular our neighbouring countries, e.g. Botswana who’s direct exports to the US pale into insignificance compared to its value add exports to South Africa’s auto-manufacturing sector which are then included in vehicle exports to the US. South Africa’s exit from AGOA would not only be a devastating blow to local jobs but also those throughout the region and thus further add pressure to an already unmanageable migration flow.
COSATU supports government’s engagements to retain South Africa’s membership in AGOA, to host the AGOA Summit in Johannesburg in November and to extend the scope of products covered to further incentivise our economic development. The Federation is heartened by the positive support we have received from the American labour movement which has a long history of solidarity with South African working-class struggles.
Whilst the Federation supports South Africa’s continued membership of AGOA, it is important our non-aligned position in geo-politics be strengthened. It is equally critical that government and business also expand trade and investment with other larging trading partners such as the European Union, China, Japan, India, Brazil and most importantly the African continent. With a 42.6% unemployment rate, we need to aggressively invest in our industrial and economic development and export opportunities.
Issued by Matthew Parks, Acting National Spokesperson & Parliamentary Coordinator, COSATU, 19 July 2023
