South African govt official on FTA w/ US

Talks between South Africa and the US on a free trade agreement hit a snag as US demands for complete access to South African markets were unacceptable, trade and industry director-general Tshediso Matona said yesterday according to Business Day (WTD, 9/20/06). As an alternative, the department had decided to set up a trade and investment framework to allow the parties to deal with problems as they arose.

Matona told Parliament's trade and industry committee he hoped this forum would allow South Africa and the US to settle their differences on a trade agreement. "Political developments in the US may also make it feasible for us to resume negotiations," Matona said, referring to last week's Democratic victories in mid-term US elections. He said the free trade talks had fallen through as the terms and conditions which the US demanded were "not friendly" to government policies.

The US approach to a free trade agreement was not developmental, he said. South Africa wanted a phased-in approach towards liberalization, protecting certain sensitive sectors, while the US wanted free access immediately for all products. Washington was not, however, prepared to grant the same across-the-board access to South African products, he said. Matona said that there was worldwide criticism of the inflexible US template-type approach to deal making. While the issue was not off the agenda it was also not something the department was immediately seized with. Government was still committed to reaching an agreement with the US, which would have obvious benefits for South Africa, but it would have to be mutually beneficial.