The new Southern African Development Community (SADC)–European Union (EU) Economic Partnership Agreement (EPA) has the potential to bolster South Africa’s muted fisheries sector and open up value-addition in a sector that holds much promise.
The new SADC-EU EPA framework, which became effective in October last year, replaced the trade provisions of the existing bilateral Trade, Development and Cooperation Agreement (TDCA) between South Africa and the EU and will maintain the external tariffs of, and harmonise, the trading regime between the Southern African Customs Union (Sacu) as a whole and the EU.
Overall, the EPA offers new opportunities for South African exporters and importers, while allowing for the correction of some of the trade imbalances that had occurred as a result of the TDCA, particularly in the agriculture sector, which gains improved market access into the EU for more than 30 products under the EPA.
For South Africa, this signals a significant opportunity to meet increasing demand from Europe for fish, particularly Cape Hake, as previously excluded fisheries products can now enter the EU market duty-free and quota-free, said EU delegation to South Africa head of trade and economics Massimo de Luca.
With fisheries at the heart of the EPA, South Africa can take advantage of one of the most traded commodities in the world and develop the industry further by way of processing and aquaculture, besides others.
Value-added products and niche products will probably benefit most from the agreement.
As South Africa is already a net exporter and the EU a proven stable market, the potential is “huge”, particularly with the opening up of exports of abalone to the EU once the final audit review is concluded in March.
South African fisheries currently only accounted for 1% of the country’s gross domestic product, but it was a strategic sector that could add 28 000 jobs in the commercial sector and double that at a local level, he said.
The EPA offered improved access on products already in place, through an increase in quotas or the complete elimination of quotas, and more flexibility on rules of origin, while addressing the shortfalls of the previous trade agreement, explained Department of Trade and Industry international trade and economic development chief director trade negotiations Niki Kruger.
“South Africa will now be allowed to export 150 000 t of sugar and 80 000 t of ethanol duty-free, while the quota for wine exports to the EU more than doubles from 50-million litres to 110-million litres,” she said on Wednesday.
Other products include flowers, dairy, fruit, fruit juice and yeast.
Meanwhile, wheat, sugar confectionery, barley, cheese, pork, cereal, butter and ice cream from the EU will gain better market access into Sacu.
The bilateral deal concluded between South Africa and the EU on the protection of Geographical Indications will result in the protection of South African favourites Rooibos, Honeybush and Karoo Lamb, as well as 102 wine names from areas like Paarl and Stellenbosch.
The EU will receive protection on more than 250 product names – about 120 names are for wines; 106 are agricultural product names such as special meats, cheeses, olives and others; and more than 20 names are for spirits and beer names, besides others.
The EU and the SADC EPA group, namely Botswana, Lesotho, Namibia, Mozambique, South Africa, Swaziland and Angola, took more than a decade to reach this deal. Angola did not sign the agreement but was part of the negotiations and may join the group at any time in the future.