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Argentinian Ambassador Complains About Poultry Tariff Hike

14 June 2013

SOUTH AFRICA - South Africa's decision to target developing countries such as Argentina with tariff increases on frozen poultry meat amounts to unfair treatment and discrimination, and does not promote the concept of South-South co-operation, says Argentinian ambassador Carlos Sersale di Cerisano.

According to BusinessDay, the ambassador said on Wednesday (12 June) 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 European Union (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 per cent. 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 Mr 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 ten per cent of South Africa’s total chicken imports, with Argentina’s share being three per cent.

Mr 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 metric tonnes to South Africa last year. The total imports of all five categories for the year was 238,608 tonnes by all exporters.

Mr 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 per cent. Applied rates for the categories range between five per cent for boneless cuts and 27 per cent for whole birds, carcasses and offal. The applied rate for other bone-in portions is R2.20/ kg. The poultry association is asking for a duty of R6,53/kg with a maximum increase to 82 per cent. The biggest imports into South Africa are bone-in portions. Mr Miguel Cassissa said the largest exporter to South Africa of this category is the EU. The Netherlands exported 32 per cent of all the bone-in portions to South Africa, followed by Brazil’s 22 per cent and the UK’s 14 per cent.

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.

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