The noise about the “dumping” of poultry products on the seemingly unsuspecting SA consumer is obscuring the real issues. Instead of addressing the long-term structural problems within the poultry industry, the department of trade, industry & competition is applying punitive tariffs to paper over its own shortcomings in developing our export capacity.
Antidumping duties may well be the most feel-good short-term trade remedy on offer for a poultry industry that claims to be struggling, yet ultimately they are ineffective. When governments implement these punitive trade tariffs, in response to either perceived or real dumping of products by foreign companies, they can claim to have “done something” and “protected local interests”.
There does not really seem to be any benefit to local consumers: despite trade protection for a number of years, and declining imports as a result, the price of poultry increased 11% over the last year. In December SA imposed provisional antidumping duties on chicken imports from Brazil (265.4%) and four EU countries — Denmark (67.4%), Ireland (158.42%), Poland (96.9%), and Spain (85.8%).
These duties will remain in effect until June 14, by which time the country’s International Trade Administration Commission (Itac) is expected to have completed its investigation into the antidumping application by the local poultry industry. It is, once again, the SA consumer (already under significant financial pressure) who will suffer.
Trade duties are supposed to be a short-term measure to protect the local industry from predatory imports, not a long-term strategy to prop up an ailing poultry industry that is beset by structural inefficiencies.
The Association of Importers & Exporters (Amie) has dissected the antidumping application and there is strong evidence that the alleged dumping has not been causing material injury to the domestic poultry industry and the duties should therefore not have been imposed in the first place.
Instead of imposing yet more barriers to trade, the government as a whole should be investigating and addressing those structural impediments that render SA producers far less efficient than they could be.
One needs to ask what has happened to the Poultry Master Plan. The core underpinning object of the plan was for local producers to export “white” meat to trade partners overseas. Three years since signing the plan nothing has happened. Instead, there have been mountains of red-tape, and cost-inducing delays driven by the local poultry sector because of the inefficiency of our import and export systems.
A punitive trade policy will not solve the barriers and inhibitors to local growth and will increase the hardships of stressed consumers.
CEO, Association of Meat Importers & Exporters
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