No change expected to quotas post-Brexit

South Africa does not expect the departure of the United Kingdom from the European Union (EU) to affect its quota tariffs with the customs union. According to Rob Davies, minister of trade and industry, tariff rate quotas (TRQs) did not increase when new countries joined the EU and therefore there was no need for them to be affected by any countries leaving.

“Our position on this is very clear,” said Davies. “Tariff rate quotas have not increased when new countries have joined the EU, the last time being when Croatia joined. South Africa was not given an additional TRQ on our products and so we don’t expect to see a reduction in our TRQ when a country leaves the EU either.” He said South Africa’s perspective on the matter

had been communicated to the EU and it was a position that had been sustained, and to date no one had disagreed with this. South Africa currently has a quota of 110 million litres of wine duty-free to the EU and is expecting to maintain that quota after the UK leaves the EU. About 40% of the country’s wine exports to the EU went to the UK, said Davies.

South Africa’s trade with the UK is governed by the SADC-EU Economic Partnership Agreement (EPA) between the EU and five Sacu member states – South Africa, Botswana, Lesotho, Namibia and Eswatini – and Mozambique. Once the United Kingdom departed from the EU, the EPA would no longer apply and a separate trade deal would have to be

negotiated and signed, said Davies. In the interim the UK and South Africa have been working on a draft agreement. Whilst several issues have yet to be finalised and fully agreed upon, the matter of tariff rate quotas with the UK has been settled with  very good outcomes for several South African products such as sugar and wine.