For frozen bone-in chicken portions from Brazil, Denmark, Ireland, Poland and Spain, the South African government has decided to suspend import tariffs for a period of 12 months.
Underlying the decision was consideration of the recent inflation in food prices for South Africans.
For the national association of importers and exporters, the decision temporarily to remove anti-dumping duties is welcomed as a win for millions of cash-strapped South Africans.
According to the Association of Meat Importers and Exporters (AMIE), Minister of Trade and Industry Ebrahim Patel’s decision was made in consideration of the on-going rapid rise in food prices in the South African market and globally.
“Chicken is the most affordable, and therefore vital source of protein for South African consumers, especially those living below the poverty line,” said Paul Matthew, chief executive of AMIE. “This shows that our government, and specifically Minister Patel, are alive to the plight of consumers, and ready to take bold actions to help mitigate the impact of rampant inflation, which is encouraging.”
Earlier this year, AMIE had asked the government to consider removing tariffs on imported chicken to reduce inflation for consumers. It had also urged that existing tariffs were reviewed, and all chicken cuts exempted from Value Added Tax (VAT).
According to Matthews, Mexico, the Philippines, and South Korea are among the countries whose governments have recently removed tariffs on imported goods such as chicken. Furthermore, he said, liberalization of trade policies can help consumers.
In South Africa, it is the finance minister who is the final decision-maker when it comes to the imposition of duties and tariffs.
Poultry producers disappointed by duty suspension
South Africa’s poultry industry body expressed surprise at the decision by Minister Patel to suspend the implementation of duties against Brazil, Denmark, Ireland, Poland, and Spain for 12 months.
Previously, the minister has supported what it calls “anti-dumping measures,” according to the South African Poultry Association (SAPA). He had implemented provisional duties against these five countries, which had lapsed in June of this year.
As these were implemented, the International Trade Administration Commission of South Africa (ITAC) had called for comments on chicken imports and the effects they were having on the country’s own chicken producers.
Following these investigations, ITAC reported there was evidence of harm to domestic production.
According to Izaak Breitenbach, general manager of SAPA’s broiler group, it also recommended to the minister that anti-dumping duties against these countries would be appropriate.
For Breitenbach, the latest decision to suspend the tariffs is contrary to the Poultry Sector Masterplan, which covered agreement over a range of measures to support the nation’s poultry industry. Among these were to end what SAPA sees as unfair competition from imported chicken sold at a lower price on the South African market than domestic products.
For SAPA, the only bright prospect is that, following the 12-month suspension, the new duties will be applicable to Brazil and the four European Union nations for a period of four years.
In the meantime, he said, the absence of tariffs for these countries will lead poultry companies to put on hold investment in projects aimed at boosting the output of South African poultry meat production.
In December of 2021, it was announced that South Africa would impose duties on some poultry meat imports from Brazil, Denmark, Ireland, Poland, and Spain.