June 17, 2013

 

Argentina protests against South Africa's poultry tariff hike

Argentine ambassador Carlos Sersale di Cerisano said that South Africa's decision to increase tariff on frozen poultry imported from developing countries could result in an unfair treatment and discrimination, and does not promote the concept of South-South co-operation.

 

The ambassador said on Wednesday (Jun 12) that the proposed import duties could cause South African importers who now obtain birds from countries such as Brazil, Argentina and the US to obtain supplies from the EU - already the biggest supplier of poultry to South Africa.

 

His comments came as the International Trade Administration Commission (ITAC) considered an application by the South African Poultry Association for significant increases up to the bound rate of 82%. ITAC will make a recommendation to the minister of trade and industry regarding the increased tariffs on a range of imported meat, after a meeting scheduled for next month.

 

The commission met on Tuesday to evaluate the outcomes of the investigation into the poultry association's application. ITAC chief commissioner Siyabulela Tsengiwe said on Wednesday it had to do a more "rigorous analysis" of the information relating to the production and financial situation of the local industry.

 

South Africa is Argentina's third-largest export market for its poultry, and the proposed tariff increases will have a huge effect on their domestic market, said Sersale di Cerisano. The objective behind the proposed tariff increases is to build an industrial policy based on protection, he said.

 

The combined imports from Argentina, Brazil, the US and the EU amount to about 10% of South Africa's total chicken imports, with Argentina's share being 3%.

 

Sersale di Cerisano said South Africa is important to the poultry industry in Argentina, even if it seems insignificant in terms of the total market.

 

Juan Miguel Cassissa, deputy head of mission at the embassy in Pretoria, said in terms of the five tariff categories under consideration for increases, Argentina exported 23,566 tonnes to South Africa last year. The total imports of all five categories for the year were 238,608 tonnes by all exporters.

 

Miguel Cassissa said South Africa has a right to ask for tariff increases under World Trade Organisation rules, if the tariff remains between the applied rate and the negotiated bound rate of 82%. Applied rates for the categories range between 5% for boneless cuts and 27% for whole birds, carcasses and offal. The applied rate for other bone-in portions is ZAR2.20 (US$0.22) per kilogramme. The poultry association is asking for a duty of ZAR6.53 (US$0.66) per kilogramme with a maximum increase to 82%. The biggest imports into South Africa are bone-in portions.

 

Miguel Cassissa said the largest exporter to South Africa of this category is the EU. The Netherlands exported 32% of all the bone-in portions to South Africa, followed by Brazil's 22% and the UK's 14%.

 

The final recommendation by ITAC to Trade and Industry Minister Rob Davies could be delayed if the Association of Meat Importers and Exporters' court application to get access to confidential information in the poultry association's ITAC application is successful.