The Congress of South African Trade Unions (COSATU) welcomes the extension of the African Growth and Opportunities Act (AGOA) benefits for South African exports by the United States (US) administration. We further welcome the US Congress’ lapsing of a Bill seeking to review and possibly downgrade relations between the US and South Africa, including its membership of AGOA. These provide certainty to key South African export industries and comfort for those workers’ jobs.
These positive developments are testimony to the strategic interventions and unity of South Africa’s government, business and labour who have worked collectively together over the past two years to ensure South Africa’s economy retains access to the world’s largest economy. We are heartened by the support that we have received from the trade union movement in the US, led by the AFL-CIO and its Affiliates.
COSATU supports government’s efforts to extend South Africa and other African countries’ membership in AGOA and negotiate a new and enhanced AGOA that will increase the scope of products covered to further incentivise Africa and South Africa’s economic and industrial development, job creation and decent work. We applaud the bold leadership by the former and current Ministers for Trade, Industry and Competition, Ebrahim Patel and Parks Tau, who have led these AGOA engagements on behalf of the African Union and South Africa.
South Africa, like all nations in this globalised era, is heavily dependent upon trade with other countries. Our key trade and investment partners include the world’s leading economies, in particular the United States, the European Union, China and Japan. AGOA has had a positive impact upon not only South Africa but Africa as a whole. It provides reduced tariff access for large volumes of South African goods to the US market. Our mining, manufacturing and in particular auto-manufacturing, clothing, jewellery, chemical and agricultural exports have benefited from this favourable tariff access.
AGOA is renewed annually, with AGOA itself due to expire in September 2025. Not only do US companies investing locally create and support thousands of South African jobs; but even more indirect local jobs in the mining, manufacturing and agricultural sectors benefit from our large volumes of exports to the US. The revenues and taxes they generate contribute towards government’s fiscus and thus its ability to fund badly needed public services and jobs. The overwhelming 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 41.9% and when 70% of young people struggle to find work. The Federation has been deeply dismayed by statements by some politicians who have sought to weaponise trade relations and undermine South Africa’s sovereignty and hard-won non-aligned stance and firm belief in the need for conflicts to be resolved through peaceful dialogue. Workers should not be punished because of global geo-political crises that they have nothing to do with and little power to resolve.
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 and Lesotho whose direct exports to the US pale into insignificance compared to their 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 to South Africa.
Whilst the Federation supports South Africa’s continued membership of AGOA, it is important our historic non-aligned role be nourished. It is critical government and business expand trade and investment with other larging trading partners such as the European Union, China, Japan, India, Brazil and most importantly the African continent. Such efforts must include South Africa’s BRICS partners and negotiations to establish an African Continental Free Trade Area. With a 41.9% unemployment rate, we need to aggressively invest in all industrial and economic development and export opportunities.
Issued by COSATU
Matthew Parks
Parliamentary Coordinator
Mobile: 082 785 0687
Email: matthew@cosatu.org.za