U.S.- South Africa Customs Union FTA

(Botswana, Lesotho, Namibia, the Republic of South Africa, and Swaziland)

Status: Negotiations DEAD

Timetable/Milestones

  • Negotiations ended: DEAD
  • Negotiations began: Jan. 13, 2003
  • Congressional notification of intent to negotiate: Nov. 5, 2002

Regional Sugar Facts

  • Production (Avg. 2005-2007): 3,120,000 mt
  • Consumption (Avg. 2005-2007): 1,996,334 mt
  • Imports (Avg. 2005-2007): 322,021 mt
  • Exports: (Avg. 2005-2007): 1,468,666 mt

The SACU domestic market for sugar is protected by a variable levy scheme whereby tariffs are set as the difference between an arbitrary reference price and the world market price (London #5), subject only to a maximum WTO bound rate of 105 percent.

A single marketing body (SASA) effectively controls both the export and domestic marketing of sugar. This control combined with the tariff system described above enables South Africa to maintain domestic prices far above world price levels.

Sugar is not freely traded within SACU, but is subject to quantitative limitations.

Botswana Sugar Facts

  • Production (Avg. 2005-2007): None
  • Consumption (Avg. 2005-2007): 60,000 mt
  • Imports (Avg. 2005-2007): 60,000 mt
  • Exports: (Avg. 2005-2007): None

Lesotho Sugar Facts

  • Production (Avg. 2005-2007): None
  • Consumption (Avg. 2005-2007): Minimal
  • Imports (Avg. 2005-2007): Minimal
  • Exports: (Avg. 2005-2007): None

Namibia Sugar Facts

  • Production (Avg. 2005-2007): None
  • Consumption (2004): 55,000 mt
  • Imports (2004): 55,354 mt
  • Exports: (Avg. 2005-2007): None

Republic of South Africa

  • Production (Avg. 2005-2007): 2,498,333 mt
  • Consumption (Avg. 2005-2007): 1,566,667 mt
  • Imports (2004): 220,000
  • Exports: (Avg. 2005-2007): 1,143,333 mt

South Africa is the world’s sixth-leading sugar exporter.

The government of South Africa maintains a number of policies that contribute significantly to the distortion of the world sugar market and allow domestic prices to remain above world market values. These include a single marketing body through which the industry can market sugar to the export market.

The ability of South African sugar producers to compete on the world market has also been greatly aided by very substantial devaluations of the Rand; in real terms, the Rand depreciated by 40% between 1998 and 2002.

Swaziland Sugar Facts

  • Production (Avg. 2005-2007): 633,667 mt
  • Consumption (2004): 314,667 mt
  • Imports (2004): None
  • Exports: (Avg. 2005-2007): 314,667 mt

Historical Access to U.S. Sugar Market

Republic of South Africa: Under the minimum WTO tariff-rate quota requirement, the U.S. currently imports a minimum of 24,220 tons from South Africa–2.17% of total WTO TRQ for 41 countries. Sugar imported from Swaziland and other members of SACU is considered as part of South Africa’s minimum access quota. Actual imports currently far exceed the minimum access quota.

Swaziland: Under the minimum WTO tariff-rate quota requirement, the U.S. currently imports a minimum of 16,849 tons from Swaziland—1.51% of total WTO TRQ for 41 countries. About half of Swaziland’s exports go to the preferentially-priced EU market.

Additional Access Granted to U.S.

Pending

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