RSA-USA Bilateral Mechanism: DIRCO briefing; with Deputy Minister

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International Relations

02 November 2022
Chairperson: Mr S Mahumapelo (ANC)
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Meeting Summary

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In a virtual meeting, the Committee was briefed by the Department of International Relations and Cooperation (DIRCO) and Deputy Minister, Candith Mashego-Dlamini, on the Republic of South Africa and United States of America Bilateral Mechanism.

DIRCO reported: Bilateral mechanisms with the USA are cordial and have gained momentum since the inauguration of President Joe Biden.

High-level engagements between South Africa and the USA increased significantly compared to the former Trump administration.

There are three structured bilateral mechanisms managed at different levels by the two countries’ respective officials: (1) the strategic level (ministerial level), (2) the work group on African and global issues (Director-General), and (3) the Annual Bilateral Forum (senior officials level). 

On the Strategic Dialogue, DIRCO reported they had trade and investment engagements between South Africa and the USA which led to lifting of Sections 232 tariffs. Discussions were also had on expanding market access for citrus, pork and chicken and establishing an advisory task force to boost trade and investment levels.

On the Work Group on African and Global Issues, there was a discussion for South Africa to host all-inclusive peace talks under the auspices of the AU.

Other proposals on Ethiopia, Mozambique, Zimbabwe and Sudan have been discussed.

The Annual Bilateral Forum (ABF) involves18 South African government departments and their US counterparts from the US Embassy, USAID and other US agencies in South Africa that collaborate across nine sectoral Working Groups.

This Forum’s cooperation projects include the areas of health, education, science, technology and innovation, transport, safety and security, environment, water and sanitation, trade and investment, and various capacity-building initiatives that are also targeted at women.

DIRCO said the US-South Africa relationship is important because the US is a major economic and development cooperation partner for South Africa; an important export market for value-added goods, a source of FDI, technology and tourists. South Africa-US bilateral relations cover a wide spectrum of issues aligned with SAs domestic priorities and the NDP such as health (PEPFAR), education, environment, agriculture, education, energy, science and technology, and safety and security. The US is now South Africas second-largest export destination.

On the Biden Administrations Strategy towards Sub-Saharan Africa: The Strategy envisages the new vision of the US for a 21st Century US-African partnership, and represents a reframing of Africas importance to US national security interests. 

The Strategy is based on four main objectives: (1) Foster openness and open societies; (2) deliver democratic and security dividends; (3) advanced pandemic recovery and economic opportunity; (4) support conservation, climate adaptation, and a just energy transition.

On the Political outlook DIRCO reported that the US was willing to assist with SAs economic recovery, support for the AfCFTA, innovation and advancement of the digital economy and the just energy transition.

There is better synergy with SA regarding the desire for inclusivity and preference for rules-based outcomes in international institutions such as the UN, G20 and WTO, and greater respect for South Africa’s voice and influence as a regional and global player.

On the economic outlook, DIRCO reported that recent high-level engagements had placed economic recovery at the centre of the bilateral relationship with the USA.

DIRCO said there was collateral damage to the SA economy due to the US-China trade conflict and the strategic competition of the two countries in pursuit of global economic and technological dominance.

Members wanted to know why DIRCO was quiet on the grain blockade by Russia in the black sea and Members felt DIRCO had been contradictory in its approach to the Ukraine-Russia war.

Members asked what the terms of reference were on the USA-South Africa bilateral mechanism and wanted to know how economic diplomacy and the projects run by DIRCO benefit ordinary South Africans.

Meeting report

The Chairperson welcomed everyone present in the meeting.

He said there was only one item on the agenda, RSA-USA Bilateral Mechanism.

He said the United States of America (USA) is one of the most strategic role players in global politics; the USA has one of the biggest economies in the world and the size of their economy makes it difficult for the country to be ignored by any serious role player globally. It is also one of the most important players in global politics through the United Nations (UN) and its organs and agencies.

The UN and USA play a major role in contributing to building peace-making and war-making globally; it is a double edge sword; in some instances, the USA pursues peace and in other instances, the USA gets involved in igniting wars. He said the USA is also one of the biggest players contributing to technological advances. Politically, the USA is very vulnerable and has the responsibility to normalise relationships with partner states and states that may not agree or be partners with the USA.

He said global patterns are shifting and China will surpass the USA as the biggest economy in the world. It is within this context that Portfolio Committee Members have to discuss what South Africa's relationship with the USA will be. He said the USA intelligence announced a serious security situation in Sandton a week ago without following South African protocol. He is unsure whether the response by the South African government was adequate. He said there should have been an immediate call by President Cyril Ramaphosa to the USA president requesting a formal meeting.

Deputy Minister remarks
Deputy Minister Candith Mashego-Dlamini thanked the Chairperson and the members present. She said DIRCO is pleased to provide an update on South Africas strategic bilateral mechanisms with the United States of America.

Bilateral mechanisms with the USA are cordial and have gained momentum since the inauguration of President Joe Biden. She said high-level engagements between South Africa and the USA increased significantly compared to the former Trump administration. This is in fulfilment of President Bidens election promise to engage Africa more respectfully and equally. In 2022 alone, all three structured bilateral mechanisms between South Africa and the USA met, which is unprecedented.

In February, the twelve annual bilateral forum met at the senior official level. This forum reviews all development cooperation projects across different sectors that are funded by the development assistance managed by USAID.

In August, the US-RSA strategic dialogue was convened at the ministerial level in South Africa after a hiatus of seven years.

This was followed by a meeting of the working group with Directors-General on Africa and global issues in Washington, DC. She said the presentation would dive deeper into issues discussed at these important fora.

In addition to all bilateral mechanisms, President Ramaphosa made an official visit to Washington DC from 15 to 16 September 2022 at the invitation of President Biden.

All three strategic bilateral mechanisms and the visit to the USA by President Ramaphosa allows for the strategic review and reset of bilateral relations with the USA including in the African context and current geo-political situation.

She said these high-level engagements not only underscored the strategic nature of South Africas relations with the USA but also the recognition of South Africa as an important regional and global role player.

Identifying new priorities to strengthen South Africas bilateral relations with the USA bodes well for South Africas efforts for economic recovery and addressing the triple challenges.

The alignment of USA’s development assistance to South Africas National Development Plan (NDP) and domestic priorities as well as an undertaking by the US government to work with the African Union (AU) in addressing peace, security and challenge on the continent, should be welcomed.

Presentation: Bilateral Relations RSA-USA
Ambassador Maud Dlomo, DIRCO, said Bilateral relations with the USA are managed through three Structured Bilateral Mechanisms:

Strategic Dialogue  (Ministerial level): The last meeting was held in SA, in August 2022, when Secretary of State Blinken visited South Africa and co-chaired the event with Minister Pandor.

Working Group on African and Global Issues  (Director-General level): The last meeting was held in September 2022 in Washington DC and co-chaired by DG Dangor and Under Secretary for Political Affairs, Ambassador Victoria Nuland.

Annual Bilateral Forum (Senior Officials level): The last meeting was held in February 2022 to review sectoral programmes and projects funded by USAID. The outcomes from the ABF inform the Strategic Dialogue discussions.

Ambassador Dlomo said apart from engagements at the above fora, there is also regular high-level interaction between the US and South Africa since President Biden took office in January 2021.

Outcomes of latest High-level engagements

Strategic Dialogue: Key discussion points

• Trade and Investment: Lifting of Section 232 tariffs, expanded market access for citrus, pork and chicken; establishment of an Advisory Task Force to boost trade and investment levels.

• Climate and Energy: The JETP, future pandemic preparedness

• Infrastructure: Investments in the rail network and the digital economy

• Health: Support for HIV/AIDS and Tuberculosis through the PEPFAR programme, local vaccine manufacturing, health innovation

• Peace and security: Mozambique, Zimbabwe, Eswatini, Lesotho, DRC/Rwanda

• Support for Public Health

• Extension of AGOA

• Support for AfCFTA

(See the presentation for further details)

Global Issues

Russia/Ukraine conflict: SA reiterated its position for using peace-building dialogue, mediation and negotiations to bring an end to the conflict. SA conveyed its strong opposition to the Countering Malign Russian Activities in Africa Bill.

Food Security: The two sides discussed the impact of the Russia/Ukraine conflict on food security, especially in Africa, and the challenges posed by dysfunctional global supply chains. The US pledged support for securing supplies of food, fertilisers and insurance to get shipments out to people in need.

Palestine: SA pointed out the inconsistency of the US in dealing with international human rights issues, with special reference to the seizure of Palestinian land by Israel.

Working Group on African and Global Issues
• Ethiopia: The parties discussed a proposal for SA to host all-inclusive peace talks under the auspices of the AU.

Mozambique: The US conveyed its willingness to step up support for Mozambique, especially in addressing the challenges of poor governance and underdevelopment.

• Zimbabwe: SA reiterated the call for sanctions to be completely lifted to lay a foundation for free and fair elections and economic recovery.

• Sudan: The two sides agreed on the need for a civilian-led government and democracy.

• China/Taiwan: SA reiterated its respect for the One China Policy.

(See the presentation for further details)

Annual Bilateral Forum
The ABF involves 18 SA government departments and their US counterparts from the US Embassy, USAID and other US agencies in South Africa that collaborate across nine sectoral Working Groups.

The ABF cooperation projects include the areas of health, education, science, technology and innovation, transport, safety and security, environment, water and sanitation, trade and investment, and various capacity-building initiatives that are also targeted at women.

Key areas aligned with SAs national interests and domestic priorities that were discussed include:
Trade and Investment: Support for local economic recovery efforts, including infrastructure development via initiatives such as the JETP and the AfCFTA; AGOA, market access, lifting of tariffs on exports of aluminium and steel products to the US and SAs hosting of the AGOA Forum in 2023. The two sides also discussed challenges in the economic relationship such as US concerns about film incentives and market access for poultry products and SAs request for wider access for citrus products and the review of GSP

Health: Cooperation will continue in 4 key outcome areas: (a) support for HIV/TB treatment and prevention, (b) enhancing resilience, (c) integrated health systems and (d) support for key innovations and research. South Africa and the US will also partner in response to global pandemics, local epidemics, and Covid-19.

• Education: The parties acknowledged the work of the SA-US Higher Education Network, which focuses on training young Master and PhD students to replace ageing academics in various South African higher education institutions.

There is also ongoing support for Early Childhood Development (ECD) through the  Dept. of Basic Education.

• Safety and Security: The US counterparts will continue to provide training and capacity-building programmes for the SAPS in activities such as investigations into corruption, cyber and financial crimes, trafficking in drugs and forensic investigations, at the International Law Enforcement Academy (ILEA) in Botswana.

The Department of Justice and Constitutional Development (DJCD) and their US counterparts committed to improving cooperation in the areas of extradition and Mutual Legal Assistance.

The parties further agreed to work on finalising the Combined DNA Index System (CODIS) agreement and the Automated Targeting System to assist SA with improving its border management.

It was agreed that the 20th SA-US Defence Committee (DEFCOM), which is to be hosted in the US, would convene in November this year.

Energy: The parties acknowledged the funding support of US$ 8.5 billion (R132 billion over 3-5 years) partnership by the US and others for a just transition to a low-carbon economy and a climate-resilient society in SA. There are ongoing negotiations to renew the bilateral Nuclear Cooperation Agreement which expires in Dec 2022. There was an agreement to convene the Bilateral Energy Dialogue as soon as possible.

(See the presentation for further details)

Why is the United States important to South Africa?
The US is a major economic and development cooperation partner for South Africa; an important export market for value-added goods, a source of FDI, technology and tourists

SA - US bilateral relations cover a wide spectrum of issues aligned with SAs domestic priorities and the NDP such as health (PEPFAR), education, environment, agriculture, education, energy, science and technology, and safety and security.

The US is now South Africas second-largest export destination.

African Growth and Opportunities Act: Allows for duty-free and quota-free exports to the US market.

AGOA was renewed in June 2015 for ten years until 2025.

AGOA creates over 62,000 direct jobs in South Africa and 100 000 jobs in the US.

South Africa received just over US$ 2 billion (or approximately R32 billion) in development assistance from the United States in 2020.

Biden Administrations Strategy towards Sub-Saharan Africa
Secretary of State Blinken launched the Strategy during his visit to South Africa in Aug 2022. It envisages the US's new vision for a 21st Century US-African Partnership and represents a reframing of Africas importance to US national security interests. It appreciates that Sub-Saharan Africa plays a critical role to advance global priorities to benefit both Africans and Americans. It is impossible to meet todays defining challenges without African contributions and leadership.

Four main objectives of the Strategy:

• Foster openness and open societies
• Deliver democratic and security dividends
• Advanced pandemic recovery and economic opportunity
• Support Conservation, Climate Adaptation, and a just energy transition

Political Outlook
The Biden Administrations stated desire to normalise relations with traditionally friendly countries was welcomed by South Africa, Africa and the developing world because of a stronger emphasis on multilateralism, a more respectful tone in engagements with Africa and enhanced support for the African Agenda.

The US is willing to assist with South Africa’s economic recovery, support for the AfCFTA, innovation & advancement of the digital economy and the just energy transition. 

There is better synergy with South Africa regarding the desire for inclusivity and preference for rules-based outcomes in international institutions such as the UN, G20 and WTO. Greater respect for South Africa’s voice and influence as a regional and global player

The emphasis in the new Africa Strategy on countering the influence of China and Russia in Africa contrasts with the new spirit of equality and respect for sovereignty espoused by President Biden.

Economic Outlook
The recent high-level engagements have placed economic recovery at the centre of the bilateral relationship with the US.

SAs hosting of the AGOA Forum in 2023 presents an opportunity to influence the deliberations on the future US-Africa economic relationship.

Collateral damage to the SA economy due to the US-China trade conflict and the strategic competition of the two countries in pursuit of global economic and technological dominance.

Chinas emergence as a superpower threatens the dominant geo-strategic position of the USA.
SA is also getting caught up in this rivalry—mainly in the telecoms field because of our dependence on Huawei 5G technology.

SA maintains cordial relations with both China and Russia. The challenge is to find a balance and remain neutral while advancing the interests of the country through maintaining and strengthening political and economic ties with both.

Key Priorities for 2023
Promote strengthened institutional partnerships and implementation of existing agreements in science, innovation, education and research with the US, including in public health and commercialisation of technologies.

Enhanced consultation and collaboration with the US on climate change and a just transition away from a carbon-intensive economy, also in the context of the AU and the forthcoming COP27.

In engagements with the US, continue to reposition South Africa as an influential actor and respected partner on the international stage, including through soft power.

DIRCO will use SAs constitution as a basis to champion democracy, human rights, restorative justice and support for vulnerable groups, in partnership with like-minded Governments and NGOs in the Americas, also taking advantage of the Biden Administration's focus on promoting social cohesion and racial redress in the US.

Discussion
Mr W Faber (DA) said there are ships with maise in the black sea which Russia has stopped. He said President Ramaphosa held the position of African Union Chair and should have been the first person to contact Russian President Vladimir Putin to tell him to stop when Russia stopped ships in the black sea. Many North African countries will not have food and there will be disasters in these countries. He said the South African government have adopted a neutral stance against the Ukraine-Russia War and should be the first government to speak out against Russia when it wants to stop ships and the treaty on sending food to north African countries yet South Africa is silent. He asked why South Africa is silent, South Africa is only silent when it suits them. He said the Committee should look into this and ask the Minister to discuss this with the Committee as this problem will be a disaster for North African countries.

Mr D Bergman (DA) said there is a Russian yacht on its way to Cape Town. He said the Committee had seen the effects of the Ukraine-Russia war in furthering the cold war between Russia and the USA. The yacht coming to South Africa signals the cold war starting in South Africa because Russia and USA are bringing their fight to South Africa. This is evident through terror warnings, and Russian millionaires bringing their yachts and doing their shopping in South Africa. He said South Africa is already facing potential grey-listing and losing the AGOA treaty. These things will affect South Africa negatively—it will impact the pockets of South Africans. SASRIA is on the verge of packing and leaving South Africa and Tongaat is experiencing challenges—this will affect families and KZN has already been plagued by riots.

He said South Africa has two nuclear powers fighting for its loyalty and South Africa needs to find a way to tell both sides to calm down and respect South Africas sovereignty. He said if South Africa is truly neutral it will abide by international laws and follow what is the right thing to do for the people of South Africa. South Africa should not be used as a playground, where they can be grey-listed or lose trade agreements with other countries. He said when judging the USA and Russia, the Committee has to look at how these two countries have behaved in South Africa and who has South Africas best interest at heart. He said those ships held up by Russia are not stopping maize from getting to North African countries but also to other African countries and South Africa itself which will increase hunger on the continent. African Union must use their power to ensure Russia stops the blockade of maize ships in the black sea.

Ms B Swarts (ANC) welcomed the presentation and noted that South Africa had structured bilateral mechanisms at different levels with the USA. She asked DIRCO to describe the terms of reference for each bilateral mechanism in detail. She said if the Committee had to assess these bilateral mechanisms, what would be the achievements of each of these engagements? She said DIRCO has so many contradictory approaches when it comes to the Ukraine-Russia conflict and asked how DIRCO provides South Africas executive with policy advice with so many contradictions. She said trade relations between the USA and South Africa are mutually beneficial to both countries and asked how DIRCO assist in protecting South Africas national interest through a balanced approach to trade relations without compromising on the African agenda.

Mr T Mpanza (ANC) said Mr Faber asked a question and it puzzles him when members of the Committee start asking questions to each other such as why South Africa is quiet and who South Africa is. He said some of the questions would be better answered by the person who asked them. South Africa is not quiet and is speaking through its policy direction-informed through legislation and policy decisions taken by the South African government.

He said what he understands with the USA—it does not matter who is president and the system dictates their policy direction, particularly when it comes to other countries and trading with the world. He is not excited about engagement between the USA and South Africa and said he would start being happy when these engagements trickle down and benefit South Africa.

He said South Africa is facing serious problems, triple challenges are deepening, and South Africans are losing hope in the government. It seems like nothing is going right in the country. External factors such as the Ukraine-Russia war and the China-USA trade war make matters worse. The Committee has repeatedly raised the economic benefit South Africans need to get out of these engagements. He said until economic diplomacy filters down to the masses of South Africans. He appealed to the deputy minister to prioritise the issue of economic diplomacy and that ordinary South Africans start feeling the benefits of these engagements.

The Chairperson said there is a request for members to appear on their video when speaking; the meeting is currently being live-streamed on TV.

The Chairperson said the bomb threat was made, on the same day he was in Johannesburg Sandton and at one of the places he was at, he asked the owner how did event affect their business. The response was almost all businesses in Sandton had been affected and lost a lot of revenue. He said tourism had been affected and people in the transport sector were also affected. People were not travelling because of fear and anxiety about the bomb threat. The Chairperson requested DIRCO to do something much more tangible than the statement released; DIRCO needs to take a much firmer position on what the US has done and there has to be a meeting between the two countries.

He said on the matter of ships being blocked in the black sea: African countries have an obligation to make sure it develops their food for food security. A continent as rich as Africa cannot produce rice or wheat. He hopes oversights mechanisms through DIRCO work towards total independence of Africa, economically so Africa can produce its food.

The Chairperson asked what clarity Russia has given South Africa on the blockade of grain ships.

He said if Africa does not accelerate its unity and global force, countries such as the USA will continue to undermine Africa because they do not see Africa as a force. This is the reason the USA still has a military base in Africa in countries such as Botswana. He said the USA is a bully and it does not matter who is in power; Muammar Gaddafi was killed by the US when President Obama was in power, inherently, the USA is a bully. He said the USA cannot say because Russia is its enemy, and South Africa cannot have relations with Russia.

Response
Ambassador Dlomo responded that there is currently a discussion between the EU and South Africa, including the USA, in helping Africa produce fertilisers; one of the products affected during the war is fertiliser and there has been a recognition that Africa can fill that gap.

On the terrorism alert, DIRCO works closely with the USA embassy in Sandton. From that time, the Embassy has given DIRCO and other agencies information on terrorist movements in South Africa. South Africas security agencies normally take care of the information; the difference was they announced the information. There was not a deeper conversation before they made the statement. The Embassy has recognised its mistakes, the current Ambassador is new and there needs to be a discussion on how things operate.

South Africa has said from the beginning that the UN should take the lead in solving the Ukraine-Russia conflict. On the grain blockade, the UN Secretary-General ensured that the ships went through and grain could get out of Ukraine. This was through a different engagement by President Ramaphosa; he talked to Ukraine and the Russian President and was able to push UNSG to solve the matter.

She said trade with the USA is always bipartisan, however South Africa enjoys a very beneficial relationship with the USA. There are many fronts where ordinary South Africans benefit from projects run by the US in the country. Many students from South Africa can study for free in the USA through university transfer projects.

She said in 2021, exported goods to the USA worth R192.4 billion and imported goods worth R98 billion from the USA. Foreign direct investment from the US was R116 billion in 2019, which was a 6.8% increase from 2018.

Tourist arrivals from the USA have also increased. 

Private companies from the USA have also continued to show confidence in South Africa by investing and building new plants in South Africa.

She said it is hard sometimes for economic diplomacy to trickle down in such a manner that communities can see but it does happen.

She said South Africa will always have its national interest and values and will never fully match the interest of another country, which might lead to contradictions. There is a balance that South Africa adopts and ensures that South Africas national interests and priorities set out by the government are taken care of in all of DIRCOs engagements.

On the terms of reference bilateral mechanisms, she said diplomats from the USA and South Africa from both countries look for economic opportunities in all sectors. Both South African and United States diplomats in respective countries engage with different departments on opportunities, issues and offerings and this group is the senior officials that meet every year. There are negotiations with each sector and these officials find pathways to working together. The group meets once a year to see whether there are implementation challenges on agreed projects. These officials work through their respective ministers and departments from each country. The report that comes from the meeting of senior officials gets sent to the strategic, where ministers meet to either solve issues or strengthen the implementation of current projects.

She said ministers would also write a report and send it to the summit which is a high-level engagement between the Presidents of both countries. She said there are numerous projects between the USA and South Africa and there is not enough time to address each project-the two countries decided to start another structured bilateral mechanism which will be different Director-Generals from both countries addressing economic and political issues. Presidents meet for high-level strategic engagements and find each other on different issues.

On greylisting, there is a specific group working on this matter to ensure grey-listing does not happen. The group works with various agencies in South Africa and internationally to solve this issue. She said South Africa is not silent and many engagements are happening to ensure the Ukraine-Russia conflict ends.

Deputy Minister Mashego-Dlamini agreed that economic diplomacy does not always trickle down. She said communities on the ground do not feel or know the projects run by DIRCO. DIRCO is looking at all trade agreements and memoranda of understanding. It has asked all departments to attach an implementation plan to trade agreements or memoranda they sign, to ensure tangible outcomes for South Africa.

The Chairperson thanked the Deputy Minister and DIRCO officials for the presentation.

He also thanked Committee Members for their critical engagement.

The meeting was adjourned.
 

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