- September 30, 2020
- Posted by: Taapano Paradza
- Category: DALRRD Permits
Once the United Kingdom Brexit transition period ends on 31 December 2020, trade between South Africa and the UK will no longer be under the SADC – EU EPA. The UK will no longer be a party to the EU’s single market and trade agreements.
The new trade agreement
The Southern African Customs Union plus Mozambique (SACUM) – UK EPA was negotiated and concluded. Notably, the agreement is largely a replica of the SADC – EU EPA. Preferential market access to the UK will remain largely the same but with few changes and most notably new Tariff Rate Quotas (TRQ).
Tariff Rate Quotas
A TRQ is a system that allows volumes of certain agricultural products imported within the quota, to enter South Africa duty-free. The same applies to exports of specific products. Volumes imported or exported outside the quota, attract the normal Customs duty rate. Importing outside a TRQ may not be as profitable because of high duties on some of the agricultural products. The use of a TRQ can provide good savings on Customs duty costs and create market access opportunities for eligible products.
Exporting into the UK
South African companies exporting into the UK will benefit from the TRQ’s of products listed below. The quotas will operate on a first-come-first-served basis. The TRQ’s will provide additional market access in addition to the quotas under the SADC EPA regime. It’s important to note that, some of the products eligible for TRQ under the SADC EPA require a quota allocation issued by The Department of Agriculture, Land Reform and Rural Development (DALRRD). The export quota applications open anytime within the first 3 weeks of October.
| Product | SACUM EPA quantity (tons) | SADC EPA quantity (tons) |
| Skimmed milk powder | 159 | 500 |
| Butter | 159 | 500 |
| Strawberries | 132 | 393 |
| Sugar | 71 365 | 150 000 |
| White crystalline powder | 159 | 500 |
| Citrus jams | 32 | 100 |
| Canned fruit, except tropical canned fruit | 18 181 | 57 156 |
| Tropical canned fruit | 1 037 | 3 080 |
| Frozen orange juice | 363 | 1 087 |
| Apple juice | 1 292 | 3 712 |
| Active yeast | 111 | 350 |
| Wine | 71 482 900 | 111 376 700 (litres) |
| Ethanol | 25 448 | 80 000 |
Importing from the UK
Products eligible for import under TRQ from the UK are below. Given the significant demand for the SADC EPA wheat quota, it is apparent that the UK wheat quota will also be in high demand. This is because of the high duties on imported wheat. The EU wheat quota gets depleted within a few weeks of the quota period opening. Meticulous planning of shipments is vital to benefit from the quota.
| Product | SACUM EPA quantity (tons) | SADC EPA quantity (tons) |
| Wheat | 30 090 | 300 000 |
| Barley | 1 003 | 10 000 |
| Butter | 94 | 500 |
| Cheese | 1 363 | 7 700 |
| Cereal foods | 796 | 2 300 |
| Pork | 150 | 1 500 |
| Pig fat | 20 | 200 |
| Ice cream | 150 | 24 |