US to drop South Africa and Rwanda from duty-free trade scheme
The Trump administration says both countries are breaking the rules of the AGOA trade programme for sub-Saharan Africa.
Key facts
Story- The US will remove South Africa and Rwanda from its duty-free trade access under AGOA.
- About $1.7 billion of South African exports a year, including cars and farm products, are affected.
- The Trump administration says both countries are not meeting the scheme's rules.
The United States plans to remove South Africa and Rwanda from its duty-free trade access programme, the African Growth and Opportunity Act, known as AGOA. The Trump administration announced the move on Monday, 3 November.
The decision would cost South Africa duty-free access to US markets for exports worth about $1.7 billion a year. Those goods include cars and farm products. The administration said both countries have failed to follow the programme's requirements.
AGOA is a centrepiece of US economic engagement with sub-Saharan Africa. It lets eligible African countries send many goods into the US without paying import duties. The administration said South Africa and Rwanda no longer meet the conditions for those benefits. The specific breaches have not been described in detail.
The move comes as Washington and Pretoria have been at odds over trade and other policy issues. It is not yet known whether the two governments have discussed the decision or how they plan to respond.
South African car makers and farm exporters would face normal US import duties. Indian firms that compete with South African goods in the US market could see new openings.
What happens next is not yet clear. It is not yet known when the removal takes effect, whether South Africa or Rwanda will challenge the decision, or whether the administration will reverse it through talks.
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