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When I’m feeling blue, all I have to do is . . .

4th March 2016

By: Riaan de Lange

  

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It is a cool winter’s morning and I find myself in Júzcar, a village of 221 people that is located in the mountains in Andalucía, near Malaga, in southern Spain.

If you are familiar with southern Spain, you will know that such villages are a dime a dozen. To reach Júzcar, one has to travel by road, stretches of which easily qualify to feature on the Discovery Channel’s Deadliest Roads. But, alas, many a Spanish village can lay a similar claim.

What makes this village of 175 buildings, including a church and tombstones, significant is that everything is painted blue. Not any blue. Smurf blue. Just in case you were wondering, it took all of 4 000 ℓ of paint. It was all meant to be a short-lived publicity for the 2011 three- dimensional movie, The Smurfs. Although movie studio Sony promised to return the village to its former glory – white – the residents voted against the idea and, on December 18, 2011, Júzcar became the world’s only Smurf village. And the primary reason for the decision? Tourism. Prior to the Smurf paint, the village attracted only 300 tourists a year. In the six months since it was painted, it attracted 80 000 tourists and it continues to attract large scores of visitors. It is quite a sight.

But this does not make you feel blue. If you really want to feel blue, then two words, gallus domesticus’, or a single word, chicken, will, no doubt, suffice. Surely, the whole ‘chicken saga’ is enough to put anyone off chicken, no matter how delightful a certain fast-food chain’s advertisements normally are.

On February 19, the International Trade Administration Commission of South Africa (Itac) announced that, on the instruction of Economic Development Minister Ebrahim Patel, it would investigate and evaluate an application by the South African Poultry Association for the imposition of safeguard measures in terms of Article 16 (referred to as ‘Section 16’ in the headline of the application) of the Trade, Development and Cooperation Agreement (TDCA) between the European Community and its member States (read European Union, or EU) and South Africa on frozen bone-in portions of fowls of the species gallus domesticus.

In recent years, antidumping duties on chicken were imposed on imports from the EU and these were extended against imports from the US (the duties were first imposed on December 27, 2000 – more than 15 years ago), while ‘ordinary’ safeguard duties were imposed against, effectively, all countries, and ordinary customs duties were imposed against all but EU exporters – this application was republished. Three of a kind and a pair. In an instalment of this column published earlier this year, I wrote about the application for chicken quota imports from the US, a compromise to ensure that South Africa retains its African Growth and Opportunity preferences. And last week we were informed of the initiation of the first-ever TDCA safeguard investigation, on which comment is due by March 10. The only remedy that has not been applied for is the countervailing measure (also known as anti-export subsidy). This is effectively initiated at country level. One could be fairly certain that South Africa would not initiate such an action, for who knows what response that would solicit. Protecting a single South African industry? At what cost? Could it even be considered a strategic industry?

So, even with a weakening currency (in 2015, the rand depreciated 34.17% against the US dollar, 20.51% against the euro and 27.15% against the British pound) South African chicken producers still have to call on all forms of protection to survive (yes, safeguards protect against fair competition). Is it to survive or is there perhaps another reason?

Unframed Glass Mirror Dumping
On February 19, Itac informed of the initiation of the sunset review of the antidumping duty (the notice headline reads ‘duties’) on unframed glass mirrors, classifiable under tariff subheading 7009.91 and originating in or imported from India. This follows an Itac notification of June 19, 2015, that, unless a duly substantiated request is made by or on behalf of the Southern African Customs Union (Sacu) industry indicating that the expiry of the antidumping duty against imports of unframed glass mirrors originating in or imported from India would likely lead to the continuation or recurrence of dumping and material injury, the antidumping duty on unframed glass mirrors originating in or imported from India would expire on March 3.

The antidumping duties were first imposed on October 25, 2006.

A response to the sunset review application questionnaire was received from PFG Building Glass, a division of PG Group (Pty) Limited, on behalf of the Sacu industry on September 11, 2015.

The investigation period for dumping stretches from July 1, 2014, to June 31, 2015, and the material injury investigation involves the evaluation of data for the period July 1, 2012, to June 30, 2015, and 2016 estimates in the event the antidumping duty expires.

Comment is due by March 29.

Plastic Package Duty Increase
On February 19, Itac informed of the proposed increase in the rates of ordinary customs duty on other plates, sheets, film, foil and strip, of plastics, noncellular and not reinforced, laminated, supported or similarly combined with other materials – of polymers of propylene, classifiable under tariff subheadings 3920.20.25 and 3920.20.35 from 10% ad valorem to 20% ad valorem and tariff subheading 3920.20.45 from free of ordinary customs duty to 20% ad valorem.

The application was lodged by Amcor Flexible, which argued, among others, that the last few years have seen the company consistently lose market share to imported product. According to the applicant, it is clear that, unless an effort is made to obtain protection on these products, the ratio of imported to locally manufactured products will further increase, thereby placing jobs at risk, despite investment in innovative and new technological advancement.

You might recall that, on March 25, 2015, Nampak announced the sale of its flexible division to Australian multinational Amcor for R250-million ($22-million). According to Nampak, at the time of the sale, its flexible division formed part of its ‘strategic portfolio optimisation’ to unlock cash and to reinvest it into ‘high-growth opportunities’ on the rest of the African continent. Nampak Flexibles had extrusion, lamination and conversion capabilities across three plants in Cape Town, Port Elizabeth and Pinetown.

Comment is due by March 18.

Geographical Indications
On February 12, the Department of Agriculture, Forestry and Fisheries, in terms of the Agri- cultural Product Standards Act, invited comments on the proposed publication of regulations relating to the protection of geographical indications and designations of origin on agricultural products intended for sale in South Africa. The deadline for the submission of comments is March 14.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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