The progress of South Africa’s agricultural sector has relied partly on exports. (Hispanolistic/ Getty Images)
South African leadership is actively working to mend fences with the US. Mcebisi Jonas has his work cut out, writes Wandile Sihlobo.
It is probably fair to say the South African leadership is working actively to mend relations with the US. There was never any doubt in this, as official statements from the Presidency have consistently highlighted how South Africa values its relations with the US. This was true even after the expulsion of Mr Ebrahim Rasool as South Africa’s Ambassador to the US, and after the US imposed tariffs on South African exports and many other nations.
For example, on 15 March, after the expulsion of Rasool, the Presidency stated that “South Africa remains committed to building a mutually beneficial relationship with the United States of America.”
Again, after the US announced tariffs, the Presidency said, “Whilst South Africa remains committed to a mutually beneficial trade relationship with the United States, unilaterally imposed and punitive tariffs are a concern and serve as a barrier to trade and shared prosperity. The tariffs affirm the urgency to negotiate a new bilateral and mutually beneficial trade agreement with the US as an essential step to secure long-term trade certainty.” This is a constructive tone and affirms the view that South Africa values its relations with the US.”
In this revitalisation process of the relationship between the two countries, President Ramaphosa, on April 14, appointed Mr Mcebisi Jonas as his Special Envoy to the US. In this capacity, he will serve as the official representative of the President and the Government of the Republic of South Africa.
Mr Jonas certainly has a challenging task ahead as the US has raised several issues about South Africa. Amongst others, the US leadership misunderstood the reality of the land issues and the farming sector in South Africa. A case in point is the issue of land reform, where President Trump has repeatedly suggested that there are widespread land confiscations in South Africa.
Land issues
Among other things leading to this vast misinterpretation of reality in South Africa is the widespread lobbying by some against the Expropriation Act, where the Act has been wrongly presented in discussions as a “permit” to allow the government to expropriate people’s property. This is, again, untrue, as we have argued at length in this essay.
Essentially, some view this Act as a new direction for land reform. This is not the case – land reform policy in South Africa hasn’t changed and is still under the three pillars of (1) restitution, (2) redistribution, and (3) tenure. Land reform is still under market principles, such as a willing buyer and willing seller approach.
This is unlikely to change, as expropriation is no ‘shortcut’; it is a long and cumbersome process, and the law safeguards that it may only be used where attempts to purchase the property on reasonable grounds have failed. The other important thing to underscore is that South Africa is not unique in having an Expropriation Act; most countries have one.
Notably, the Expropriation Act, per se, is not new; we see an update from the 1975 existing piece of legislation here. (I have discussed here at length).
Importantly, the South African agricultural sector is flourishing and has more than doubled since 1994. This isn’t to say there aren’t domestic issues. Inept municipalities, poor road infrastructure, stock theft, and port inefficiencies are some of the domestic challenges the sector faces. But the threat to property rights isn’t one of them.
Trade issues
Among other things, Mr Jonas will also be tasked with addressing trade matters with the US. South Africa faces tariffs as high as 31% (thanks to the 90-day pause, we now face 10% like most countries). Before these tariffs, South Africa enjoyed tariff-free access to the US market through the African Growth and Opportunity Act. The tariffs against South Africa have nullified this, and we must find a path forward.
I prefer South Africa to work to get a Free Trade Agreement with the US, cognisant that such brings a challenging environment for some industries. There will be winners and losers. Still, it may be the best path for South Africa.
Such engagement, however, will take time to negotiate. This means that in the near term, we must find a way for South Africa to continuously trade at favourable tariff levels or be duty-free with the US. This is key for industries such as agriculture and the auto sector.
Mr Jonas’s work is significant to South Africa, and he and his team deserve all our support – from business, civil society, etc.
The US is a vital market and trading partner to South Africa. Mr Jonas’s presence as South Africa’s official representative is key in reviving the relations.
Wandile Sihlobo is an agricultural economist and author of three books. His latest book is “The Uncomfortable Truth About South Africa’s Agriculture”.
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