Identifying Export Opportunities for SACU in the US Market

This report analyzes the potential for the Southern African Customs Union (SACU) to increase goods exports to the United States by transitioning from the African Growth and Opportunity Act (AGOA) and the Generalised System of Preferences (GSP) to a formal Free Trade Agreement (FTA). It concludes that while an FTA could provide legal certainty and extend duty-free access to specific products, the most significant benefits would likely come from relaxing rules of origin and limiting the use of US trade remedies, such as anti-dumping duties.

• The report concludes that the potential advantages of extending market access through a Free Trade Agreement (FTA) are small in scope, and the primary benefits would be found in rules of origin and the US administration of trade remedies rather than tariff negotiations.
• Iron and steel goods are the most valuable SACU exports not covered by AGOA or the GSP; however, their growth has been hindered by the US application or threat of anti-dumping duties, including a 113% duty on South African vanadium exports in 2002.
• For clothing and textiles, the primary constraint for South Africa is the rules of origin. An FTA that relaxed these rules would be a major advancement, provided South Africa remains competitive after the end of the Multifibre Arrangement (MFA).
• The products that would benefit most from an extension of duty-free access via an FTA are manganese, peaches, wool, and animal hair, as these currently face significant Most-Favoured Nation (MFN) tariffs and are excluded from AGOA and GSP.
• There is significant under-utilisation of available preferences. In 2004, South Africa had $114 million in exports for which preferences were available but either not claimed or only partially claimed.
• AGOA has significantly stimulated clothing exports, particularly for lesser-developed countries. Lesotho's exports to the USA doubled in two years, and by 2002 it became the largest single supplier of apparel to the USA from sub-Saharan Africa.
• The growth of automotive products in manufactured exports to the USA quadrupled during the first four years of AGOA, rising from $145 million in 2000 to $582 million in 2004, though the report notes the MFN tariff of 2.5% was not a significant barrier.
• A high proportion of SACU exports to the US do not require preferences because they already face zero MFN tariffs; in 2004, 59.2% of exports fell into this category, dominated by minerals like platinum group metals and diamonds.
• The report suggests that some AGOA gains may be trade diversion rather than trade creation. For example, the rise in South African prepared pear exports to the USA was offset by a larger decline in exports of the same product to the EU.

APA

Netshitomboni, N., Stevens, C., & Kennan, J. (2006). Identifying Export Opportunities for SACU in the US Market. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2013/06/9-Trade-Report_No_9withchanges14Mar06.pdf

Chicago

Netshitomboni, Nnzeni, Christopher Stevens, and Jane Kennan. Identifying Export Opportunities for SACU in the US Market. South African Institute of International Affairs, 2006. https://saiia.org.za/wp-content/uploads/2013/06/9-Trade-Report_No_9withchanges14Mar06.pdf.

Wikipedia

{{cite report |last1=Netshitomboni |first1=Nnzeni |last2=Stevens |first2=Christopher |last3=Kennan |first3=Jane |title=Identifying Export Opportunities for SACU in the US Market |publisher=South African Institute of International Affairs |date=2006 |url=https://saiia.org.za/wp-content/uploads/2013/06/9-Trade-Report_No_9withchanges14Mar06.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{netshitomboni2006identifying, author = {Netshitomboni, Nnzeni and Stevens, Christopher and Kennan, Jane}, title = {{Identifying Export Opportunities for SACU in the US Market}}, institution = {South African Institute of International Affairs}, year = {2006}, url = {https://saiia.org.za/wp-content/uploads/2013/06/9-Trade-Report_No_9withchanges14Mar06.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }