South Africa has used the visit by US Secretary of State Antony Blinken to once again push the US government to lift punitive Trump-era tariffs against South African metal imports to that country.
In 2018, then President Donald Trump’s administration imposed additional tariffs on global steel and aluminium imports, at 25 and 10 percent ad valorem, respectively.
The tariffs were imposed for national security reasons, based on the findings of an investigation in terms of Section 232 of the US 1962 Trade Expansion Act.
Certain countries were granted temporary exemption from the tariffs, including Canada and Mexico, but no exclusion was granted to South Africa, despite extensive lobbying by the government.
The imposition of the duties thus far has had a negative impact on South Africa’s productive capacity and on jobs, as the country is one of the largest metals producers.
Minister of International Relations and Co-operation Naledi Pandor on Monday told Blinken that South Africa and the US should now strengthen their bilateral trade ties after almost seven years of strained relations.
Pandor said South Africa was the largest US trade partner in Africa, as the positive growth in two-way trade in goods had risen from $13.9 billion (R231bn currently) in 2010, to $21bn in 2021.
However, Pandor said there was much more the two countries could and should do.
“As was discussed earlier this year, at the meeting of the 12th Annual Bilateral Forum (ABF), our objective should be to significantly expand two-way trade and investment that will contribute to the shared growth and prosperity for the people of South Africa and the US,” Pandor said.
“A good start in this endeavour would be to speedily resolve the long-standing unresolved trade issues around market access, including the removal of Section 232 tariffs on South African steel and aluminium imports into the US.”
Blinken is leading his country’ delegation to the SA-US Strategic Dialogue. The dialogue aims to reinforce and deepen commitment to bilateral co-operation on global issues, as well as on a wide range of shared priorities, including health, infrastructure, trade and investment, and climate.
From his side, Blinken confirmed the question of tariffs on steel and aluminium imports was raised in a closed session with South African government representatives.
However, he said the US Department of Commerce was in charge of those talks.
“My colleagues back home, the US trade representative’s office, are looking at this as we speak, but I will refer to them about that process,” he said.
The proclamation of tariffs on steel and aluminium imports followed reports from the Secretary of Commerce that imports of these products threatened to impair US national security.
Back then, US Census Bureau data indicated that the US imported a total of 33.4 million tons of steel in 2017, but imports from South Africa were approximately 330 000 tons, or less than 1 percent of total US imports.
The South African government had argued that the country’s imports did not pose a threat to US national security, or to its steel and aluminium industries.
The push for the US to lift the metals embargo comes at a time when the South African government has proposed a six-month ban on scrap metal exports in a bid to combat copper theft and damage to infrastructure.
Donald MacKay, trade advisor for the Metal Recyclers Association, said scrap metals exports had been banned for three months in 2020, with little to no effect.
“I think it’s quite a desperate reaction to the nightmare that is unfolding with the theft of infrastructure. I’m not sure that’s the way to go, but I think a lot of other proposals put forward are actually quite good, such as banning trade of scrap metals in cash,”
“But exports for scraps are quite a small amount of scrap, somewhere between 12 and 15 percent of all scrap. The bulk of scrap is still consumed locally, and it therefore follows that probably the bulk of stolen scrap is probably getting processed in South Africa,” he said.
BUSINESS REPORT