PRETORIA, SOUTH AFRICA - The United States and five
southern African nations (Botswana, Lesotho, Namibia, South Africa and
Swaziland) today agreed on a roadmap for negotiating a free trade agreement
(FTA) designed to lower trade barriers, open markets and stimulate economic
growth and development. This will be the United States' first FTA in sub-Saharan
U.S. Trade Representative Robert B.
Zoellick also announced an initial $2 million in U.S. funds for new trade
capacity building initiatives related to the FTA. The initiative will help those
five countries - members of the Southern African Customs Union (SACU) - prepare
for and participate in forthcoming free trade agreement negotiations, implement
agreed commitments, and take advantage of new trade opportunities. Discussions
regarding the FTA will occur in February, with officials meeting to plan the
negotiating process and develop an effective negotiating framework.
"The FTA between
the United States and the five SACU countries of southern Africa will provide
new opportunities for the peoples of all our countries, and will particularly
provide a boost to regional growth, development and prosperity. We want to hit
the ground running, and U.S. trade capacity building support will help provide
the tools for a mutually effective negotiation," Ambassador Zoellick said. "U.S.
support will help ensure that our FTA will deliver the tremendous benefits of
open markets to all sectors of U.S. and southern African society."
Separate Signing Ceremony, U.S. Provides $15 Million in Housing Loan Guarantees
to Help Build 90,000 Homes for up to 500,000 Low Income South African
Following the FTA
announcement, Zoellick participated in a signing ceremony with Sankie
Mthebi-Mahaneye, Minister of Housing, launching a U.S. housing initiative that
can benefit up to 500,000 South Africans. The agreement will provide $15 million
from the U.S. Overseas Private Investment Corporation (OPIC) to the South
African government and its National Urban Housing Association (NURCHA) and First
Rand Bank. When combined with $5 million from another U.S. sponsor, the Open
Society Institute, the $20 million program will help build 90,000 homes for
trade is about freedom and economic opportunity. While we put together the
building blocks for freer trade between South Africa and the United States
through our planned FTA, the United States is pleased to help South Africa
address some critical infrastructure needs right now - with a $15 million loan
guarantee to help provide low-income families with 90,000 homes for up to
500,000 people," said Zoellick.
with U.S. Agency for International Development support for South Africa's
housing infrastructure - $225 million in loan guarantees and over $90 million in
grant funds, technical assistance and training - close to half a million
households have new or upgraded housing, with at least 100,000 new units for the
meeting on trade issues, Ambassador Zoellick and the SACU Trade Ministers
discussed goals for the FTA and a roadmap for forthcoming negotiations. He was
joined by the U.S. Ambassador to South Africa, Cameron Hume, and other senior
FTA, we will build on the success of the African Growth and Opportunity Act and
establish a true trade partnership between the United States and the nations of
southern Africa," Zoellick said. "The FTA will support our common objectives in
the World Trade Organization (WTO) and serve as a model for what developed and
developing countries can achieve together through trade." Following his visit to
South Africa, Ambassador Zoellick will proceed to Mauritius, where he will lead
the U.S. delegation to the Second U.S.-Sub-Saharan Africa Trade and Economic
African Customs Union (SACU) Trade Ministers are: Jacob Nkate, Minister of Trade
and Industry of Botswana; Mpho Malie, Minister of Industry, Trade and Marketing
of Lesotho; Jesaya Nyamu, Minister of Trade and Industry of Namibia; Alec Erwin,
Minister of Trade and Industry of South Africa; and Abednego Ntshangase,
Minister for Foreign Affairs and Trade of Swaziland.
SACU is the
largest U.S. export market in sub-Saharan Africa. U.S. exports to SACU were
worth more than $3.1 billion in 2001. Leading U.S. sales to the region include
machinery, vehicles, aircraft, medical instruments, plastics, chemicals,
cereals, pharmaceuticals and wood and paper products. U.S. foreign direct
investment in the SACU countries totaled $2.8 billion in 2000, largely in
manufacturing, wholesaling and services.
The five SACU
countries are leading beneficiaries of the African Growth and Opportunity Act
(AGOA), a U.S. trade preference program that, when combined with another U.S.
preference program (the Generalized System of Preferences, or GSP), provides
duty free access to 38 sub-Saharan countries on approximately 6,500 products.
The SACU countries were the top U.S. supplier of non-fuel goods under AGOA in
2001, accounting for more than a quarter of U.S. non-fuel imports from eligible
sub-Saharan African countries. Between 2000 and 2001, total U.S. imports of
non-fuel AGOA goods from South Africa grew by more than 30 percent. During the
same period, U.S. imports from Lesotho rose more than 53 percent, and sales from
Swaziland were up 50 percent. As a result of AGOA, Namibia received a
multimillion investment in an integrated textile and clothing production
complex, and negotiations are underway for two additional factories.
The $2 million in
additional U.S. trade capacity building funds will build on a longstanding U.S.
commitment to trade-related technical assistance in southern Africa for AGOA and
the WTO. In fiscal year 2002, the United States committed nearly $5.6 million in
direct country assistance to Botswana, Lesotho, Namibia, South Africa and
Swaziland, up from $1.2 million in 2001. The SACU countries also from over $28
million in programs for the Southern African Development Community (SADC). The
United States provided $345 million in trade capacity building activity in
sub-Saharan Africa from 1999 to 2002. The United States is also the largest
donor of trade-related technical assistance worldwide, accounting for over 37
percent of $1.5 billion in global funding in 2001.