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africa|botswana|financial|health|safety|service|services

SA’s Brexit approach: Roll over and play dead

4th October 2019

By: Riaan de Lange

     

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I concluded the August 30 instalment of this column, which was titled ‘Brexit – we’re not gonna take it’, with this sentence: “It is time for South Africa to step up and take the game to Britain.” I was not envisaging a ‘roll-over’.

On September 11, the South African Department of Trade, Industry and Competition (DTIC) issued a media release titled ‘South Africa agrees new economic partnership agreement (EPA) with the UK in the event of a no-deal Brexit’. The release stated: “The new agreement, which will be known as the Sacum-UK Economic Partnership Agreement, will effectively roll over and replicate the terms of trade present in the existing SADC-European Union (-EU) EPA, including in respect of tariffs, quotas, rules of origin, and health and safety regulations. The new EPA will come into effect in the event that the UK leaves the EU on October 31, 2019, and will govern bilateral trade between the six Sacum countries on the one side and the UK on the other.” (Sacum stands for Southern African Customs Union and Mozambique). The obvious question is: Why?

The UK government published its own media release on September 19, titled ‘UK and Australia commit to rapid and ambitious free-trade agreement’. The release states in the opening paragraph: “The UK and Australia will today agree to begin trade negotiations as soon as possible after the UK leaves the EU on 31 October.” Not ‘roll over and replicate’, but ‘begin’.

Interestingly, according to the DTIC media release, South Africa’s bilateral trade with the UK is worth £7.5-billion, while trade between Sacum and the UK is worth £9.7-billion and that between Australia and the UK £16.6-billion. The UK is South Africa’s fourth-largest destination for exports, and the UK is one of Australia’s largest trading partners.

Why then the difference in approach? Evidently, the South African government does not consider itself to be an ‘equal’ with the UK and is thus more than content to perpetuate a poor merchandise trade deal that was originally concluded with the EU.

Ignoring, for the moment, the South African government’s ‘holier than General Agreement on Tariffs and Trade’ approach, let us consider its fixation on joining the Lomé Agreement. Instead of entertaining it, the EU convinced South Africa to rather negotiate a ‘special’ trade agreement, which became the Trade, Development and Cooperation Agreement (TDCA) and was recently transformed into the SADC-EU EPA.

Interestingly, the EU negotiated the TDCA with South Africa, which was a member of Sacu. So, South Africa’s trade agreement with the EU became Sacu’s trade agreement with the EU. Any economist worth his or her salt would tell you that the TDCA was a poor result for South Africa, and ultimately for Sacu.

Yet, the South African government was more than eager to formalise this trade agreement with the UK. Mind-bogglingly, the South African government seems oblivious to the fact that trade agreements are no longer only about merchandise trade but also about services.

Why did the agreement not include, among others, the treatment of South Africans visiting the UK? If only South African government officials also had to endure the process and financial expense of obtaining a UK visa, including standing in endless queues! Very few African countries, including two Sacum members – Botswana and Namibia – benefit from the UK/EU’s Registered Traveller scheme, which grants access “to the UK/EU self-service e-passport gates, thus avoiding the long queues at non-UK/EU passport control”. In case you are wondering, “Registered Traveller is no longer taking applications for the following countries: Australia, . . . New Zealand . . . This is because travellers from these countries no longer require Registered Traveller to use the e-passport gates in the UK.”

If ever there was a time for the South African government to stand up to its former colonial master, and to negotiate with vigour with it as an equal, now is that time. But, alas, to paraphrase Cliff Gladwin: “Cometh the hour, cometh the roll-over.” All that remains is to play dead.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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