President Cyril Ramaphosa. File photo by ANGELA WEISS/AFP via Getty Images
President Cyril Ramaphosa has tried to woo United States business elites during his-day visit to New York as Pretoria awaits a decision by American lawmakers on whether the African Growth and Opportunity Act (Agoa) will be given an early extension.
Speaking at the US-South Africa trade and investment business roundtable dialogue on the sidelines of the United Nations General Assembly, Ramaphosa said the government was working with the US administration to make the case for an extension of Agoa prior to its expiry in 2025 to current beneficiary countries for a further period of 10 years.
The South African president, who spoke to members of the US Chamber of Commerce among others, said the US remains an important economic partner in trade and investment, with great potential to further expand economic ties.
“There are a reported 600 US firms based in South Africa, and more firms will find value in being present in South Africa in the next phase of our growth. According to the US Bureau of Economic Analysis, US firms in South Africa generate over $30 billion of revenue per annum,” he said.
South Africa’s relationship with the super power has been under strain since May, when US ambassador to South Africa Reuben Brigety accused the government of loading arms onto the sanctioned Russian vessel, Lady R, at the military port of Simon’s Town.
This led to the rand tanking against the dollar and reputational damage to the country.
South Africa’s resistance to pressure from the US to surrender its non-aligned stance on Russia’s war in Ukraine added to the tensions between the two countries, with Washington threatening to withdraw Pretoria’s hosting of the Agoa summit in November.
But the US has since changed its hardline stance after an independent panel investigating the Lady R saga found no evidence to substantiate Washington’s claims.
Government insiders have previously told the Mail & Guardian that the panel’s findings could sway Washington to consider extending South Africa’s inclusion in Agoa.
Ramaphosa said part of South Africa’s ambitious trade and investment agenda was its economic partnership agreement with the European Union and the United Kingdom.
“Trade flows continue to be very significant. Exports of manufactured goods, particularly of automotive products, have grown,” he said. “[W]e are expanding our trade links with countries in the Middle East, Asean [Association of Southeast Asian Nations], Mercosur [Southern Common Market] and Brics group. These include some of the fastest-growing economies. They are a source of capital for our industry and markets for our goods.”
Despite higher levels of load-shedding experienced in the past week, the president marketed South Africa’s energy generation as having improved, adding that private energy generation, specifically in renewables, constitutes a growing share of total energy generated.
He blamed under-investment in ports and rail infrastructure for South Africa’s poor rail and freight services, saying that the government was now working closely with the private sector to use the wider pool of skills available to improve the logistics system.
“A focused effort to expand workplace exposure for graduates, coupled with a shift to technical education and the teaching of maths and science, will enable South Africa to build a larger resource of skilled workers. This focus on skills is vital to our ambitious investment drive.
“We have just concluded the first five-year phase of our investment drive, raising R1.5 trillion in commitments from firms across the economy. These range from automobiles to pharmaceuticals, mining, the digital economy, manufacturing, energy, transport logistics and many others. We have now increased the target over the next five years to R2 trillion.”
The next South Africa Investment Conference will be held in March 2024.