Poultry import tariff a delicate balance, Patel admits
The International Trade Administration Commission has its work cut out in deciding whether to approve a poultry import tariff request by the South African Poultry Association, Minister of Trade, Industry & Economic Development Ebrahim Patel told reporters ahead of his budget vote in Parliament.
SAPA, a representative of local poultry producers, applied to ITAC for an 82% increase to the tariff last month, saying that local producers cannot compete with dumping from the international market.
The Association of Meat Importers and Exporters said such a tariff increase would make low cost meat products unaffordable for low income households. However, local producers maintain that cheap imports are rendering local poultry producers unable to compete.
Patel acknowledged that striking the balance between preserving the local industry and keeping poultry affordable could prove challenging for ITAC, which would have to make a decision by the end of August and refer it to him for concurrence.
"[T]he policy challenge that government faces is that it wants to promote and support jobs locally, and [it has] a responsibility to ensure cheap sources of meat protein to working and poor South Africans. ITAC has a difficult job in applying their mind to the facts," said Patel.
Patel said government saw great value in the local poultry industry because it was a relatively easy market for small scale producers to enter.
"Once ITAC recommends, I will have to decide to accept it or not. While we need to do is ensure that any tariff adjustments we contemplate must be in a reciprocal basis. If businesses apply, we expect them to make commitments for a more affordable point of entry for industry," Patel said.
Patel said the department must ensure that producers have as many avenues as possible to enter the market and that the "balancing act for industrial development as well as consumers" was not a light decision to make.