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Final month, China’s Normal Administration of Customs launched its customs information for 2023. The info confirmed that China’s complete commerce with Africa grew a modest 1.5 p.c in 2023, reaching $282.1 billion, however Africa’s commerce deficit with China widened. Whereas Chinese language exports to Africa reached $173 billion, a rise of seven.5 p.c over 2022, Africa’s exports to China dropped by 6.7 p.c to $109 billion.
Given these figures, it got here as welcome information that final month China decreased import tariffs for South African Rooibos tea from between 15 p.c to 30 p.c down to six p.c. Regardless of being South Africa’s greatest commerce associate and one of many world’s largest tea shoppers, China’s excessive tariff charges for South African Rooibos tea have meant that China was simply South Africa’s seventh-highest export vacation spot in 2023, and previous to this, didn’t even make it to the highest 10 for its famously wholesome caffeine-free tea.
Compared, China’s neighbor, Japan, regardless of making use of a 17 p.c tariff charge for Rooibos tea, has been South Africa’s prime export vacation spot for its Rooibos tea since 2020, as a result of Japan has a big marketplace for wholesome tea. Japan is adopted by European international locations, corresponding to France, Germany, and the Netherlands that provide zero tariffs for South African Rooibos teas as a part of their Generalized Scheme of Preferences for growing international locations.
Given the dimensions of China’s client market, China’s determination to cut back tariffs for South African Rooibos tea by nearly 80 p.c might make China a precedence export market in future. This might not solely assist scale back the commerce deficit between South Africa and China, but additionally, if branded Rooibos merchandise come into China, it might present South Africa the chance to spice up job creation and its value-added exports to China. South Africa’s Rooibos trade produces roughly 20,000 tons yearly and employs 5,000 folks.
That mentioned, there may be one main problem to this aspiration: Recognition of South Africa’s Geographical Indications (GIs), together with the GI for Rooibos tea.
GIs grant distinct rights to “the qualities, traits or fame of the product primarily as a result of place of birth,” in accordance with the World Mental Property Group. In different phrases, GI safety permits producers to boost retail costs. Effectively-known examples embrace French champagne and brie, English cheddar, and Italian prosciutto di parma ham, that are acknowledged in lots of international locations and areas, together with China.
Rooibos and different African merchandise corresponding to South African wine and Benin’s “sugarloaf” pineapples fall below the class of eligible Geographical Indications. On grocery store cabinets, GI recognitions means these merchandise have to be authentic – others can’t manufacture variations of them, and the companies that promote these merchandise can in the end get increased costs, which means increased incomes in African international locations.
China grew to become Africa’s first associate to decide to growing a course of to acknowledge Africa’s GIs on the eighth Discussion board on China-Africa Cooperation (FOCAC) in 2021, however no clear course of has been revealed up to now. With the ninth FOCAC on account of happen in late 2024, and with the welcome push towards opening up China’s market to African merchandise in recent times, African leaders want to make sure that a transparent technique to implement a course of to acknowledge Africa’s GIs makes it to the FOCAC 9 agenda.
There are already a number of Chinese language firms importing unprocessed Rooibos tea leaves into China and packaging them below their very own manufacturers. Pushing for the popularity of African GIs and exporting GI merchandise, corresponding to Rooibos tea, might help African international locations to compete with different areas within the Chinese language market and create area for distinct, higher-value African merchandise to enter the Chinese language market.
Happily, and with the latest tariff minimize as a sign of goodwill and curiosity from China, South Africa is nicely positioned to prepared the ground in pushing for China to acknowledge African GIs. The South African Customs Union (SACU) has already secured the popularity of Rooibos tea’s GI standing within the European Union in 2014 and the United Kingdom has additionally continued to acknowledge its GI post-Brexit. SACU can apply classes discovered from its negotiations with the EU and work with different African regional our bodies, together with the African Continental Free Commerce Space Secretariat, to barter GI offers with China.
Certainly, a shared African technique to see the FOCAC 8 pledge delivered, maybe utilizing Rooibos as a place to begin, might make some distinction to closing that commerce deficit in 2024, in order that each the quantity and worth of African exports to China constantly will increase going forwards.
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