The United States chapter of the South African Chamber of Commerce has welcomed the extension of the African Growth and Opportunity Act (AGOA) until the end of the year.

For now, it still includes South Africa as a beneficiary.

US Trade Representative, Jamieson Greer, also issued a statement confirming the extension would apply retro-actively to September last year, when AGOA expired.

Greer indicated that AGOA for the 21st century had to demand more from US trading partners and expressed a willingness to work with Congress over the next year to modernize the programme to better align with President Donald Trump’s America First Trade Policy.

In signing a new government funding deal into law, Trump also re-authorised AGOA for one year, backdated until September last year – a move described as having a stabilising effect for South Africa by the US chapter of South African Chamber of Commerce whose President is Neil Diamond.

“Over the past few months, uncertainty created concern and real concern for companies managing long term contracts, investors assessing opportunities and risk and workers whose livelihoods depend on the AGOA framework. This decision removes a lot of that uncertainty and the cloud that was hanging over business, restoring some business confidence within a framework that business can operate. We need to be clear: it doesn’t remove the tariff regime that has been implemented, especially reciprocal tariffs. But it at least gives us a breath of air in an environment where we need to continue bilateral trade between South Africa and the United States.”

Greer said his office would work with relevant US agencies to give effect to any modifications made to the Harmonised Tariff Schedule of the United States as a result of AGOA’s re-authorisation.

The reciprocal tariffs imposed by Trump last August appear to undercut AGOA’s benefits, although the legality of those unilateral levies remain the subject of a legal review by the Supreme Court, after two lower courts already ruled them illegal; creating an additional layer of confusion in terms of what exactly the road ahead looks like.

Diamond adds, “We know that South Africa is the largest beneficiary under AGOA for sub-Sahara Africa, specifically in key sectors such as automotive, manufacturing, agriculture and Agro processing, wine and value-added food products, and then industrial and manufactured components. Where we’ve been subject to those tariffs, AGOA is really going to give us some relief from those tariffs. Exactly how this plays out will be dependent on an engagement between the US Trade Representative, Jaime Greer, as well as Minister Box Dell and the team from the Department of Trade and Industry. But we at least see this as a step in the right direction, restoring business confidence in the US-South Africa economic relationship.”