Trade is a foundation of any country or society that aspires to prosper. It is as old as human civilisation.
In ancient times, trade began as a barter system in which humans exchanged animal skins or services for food. In Mesopotamia (modern-day Iraq) and ancient Egypt, people used gold bars as currency, and later in other parts of the world metal coins were introduced as currency to facilitate and simplify trade.
Over time, people began trading goods over long distances, where local trade grew and became part of international trade, bringing more people together and creating prosperous societies in different regions of the world.
The importance of trade in producing global prosperity was highlighted by President Ramaphosa when he delivered a keynote speech recently at the U.S.-South Africa Trade and Investment Business Roundtable Dialogue, which took place in New York on the sidelines of the 78th session of the UN General Assembly (UNGA).
President Ramaphosa lamented the threat posed to global prosperity by the ongoing escalation in geopolitical tensions, increasing trade protectionism, and fragmentation.
This unfortunate turn of events has reversed gains made in recent decades by the international community to create a more open, rules-based trading system, which has helped to facilitate cross-border investments and supported global economic growth. Globalisation played a pivotal role in increasing employment in many countries and encouraging innovation and emergence of new technologies.
As an open economy with about 70% of its gross domestic product (GDP) linked to trade, South Africa has benefited immensely from globalisation. We trade with several countries and regions including the United States, European Union, United Kingdom, Middle East, East Asia, South America, and the BRICS group, of which South Africa is a member.
A fragmented and divided world will not put our country in good stead. World leaders must work together to reverse and put to an end to fragmentation and protectionism.
South Africa wants to see the continuation and expansion of international trade, but trade must be balanced and mutually beneficial amongst trading partners.
It is encouraging to note that the South African government and the U.S. administration are working together to explore extension of the African Growth and Opportunity Act (AGOA) for a further period of 10 years.
This is a welcomed development considering that AGOA, which expires in 2025, provides eligible sub-Saharan African countries including South Africa with duty-free access to the U.S. market for over 1,800 products. This is in addition to the more than 5,000 products that are eligible for duty-free access under the Generalised System of Preferences programme.
As part of the engagement to extend AGOA, South Africa will host the 20th U.S.-sub-Saharan Africa Trade and Economic Cooperation Forum (AGOA Forum) in Johannesburg from 2-4 November 2023.
The long-awaited AGOA Forum, which is expected to also feature the ‘Made in Africa Exhibition’, seeks to strengthen trade and investment ties between the United States and sub-Saharan Africa countries.
