World Trade Organisation (WTO) briefing

Meeting report

Chairperson’s opening remarks

The Chairperson, Mr M Rayi (ANC, Eastern Cape), opened the meeting. The Committee was convening to attend to the World Trade Organisation’s (WTO) fisheries subsidies agreement. He welcomed the South African Ambassador to the WTO, Ms Xolelwa Mlumbi-Peter and officials from the Department of Trade, Industry, and Competition (DTIC), who will be presenting on this matter.

As an introduction, the Chairperson reminded the Members of a briefing received from the DTIC in November 2022. During that briefing, Mr Xavier Carim, the former South African permanent representative to the WTO, presented various aspects of South Africa's trade portfolio, including the African economic integration, Southern African Customs Union (SACU), Southern African Development Community (SADC), the African Continental Free Trade Area (ACFTA) and trade policies. A presentation on the WTO and the outcomes of the12th Ministerial Conference (MC) was also given. Discussions on patent protection waivers, fisheries department issues and e-commerce were had.

Regarding fisheries subsidies, the Chairperson mentioned the agreement aimed to protect the environment, fulfil the United Nations Sustainable Development Goal (UNSDG) 14.6 mandate and prohibit subsidies to vessels or operators involved in illegal fishing practices. He said that the agreement required a two-third membership ratification to come into force, hence the current meeting aimed at discussing and ratifying the agreement.

The Chairperson then proceeded to hand over to the WTO Ambassador.

South African’s Ratification of the WTO Agreement on Fisheries Subsidies

Ms Xolelwa Mlumbi-Peter, South African Ambassador to the WTO, acknowledged the Chairperson's introduction and indicated her readiness to proceed with the presentation, focusing on phase one of the fisheries agreement concluded during the MC12. The purpose is to navigate the ratification processes outlined by the cabinet.

Ms Mlumbi-Peter outlined the presentation's objectives, which included presenting the agreement's benefits, provisions on fisheries subsidies, the necessity of ratifying the implementation plan, associated risks, financial implications and benefits for vulnerable groups and society at large. She highlighted the consultations undertaken in the lead-up to concluding the agreement.

Discussing benefits, she emphasised the contribution to Africa's medium-term strategic framework and the UNSDG 14.6, aimed at prohibiting certain fisheries subsidies contributing to overcapacity and overfishing. She stressed the importance of environmental sustainability, South Africa's National Development Plan (NDP) 2030 and global fisheries management for socio-economic development.

Regarding the fisheries subsidies agreement, Ms Mlumbi-Peter detailed the first phase, addressing illegal, unregulated, and unreported (IUU) fishing, subsidies for overfished stock and targeting unregulated high sea fishing. She explained the provisions made for special and differential treatment of developing countries and the ongoing negotiations for phase two to address overcapacity and overfishing.

She elaborated on the prohibitions against IUU fishing and subsidies for overfished stocks and unregulated high sea fishing, emphasising the importance of global efforts in fisheries management. She discussed South Africa's compliance and the need to ensure continued efforts towards conservation and sustainable management.

Addressing financial implications and risks, Ms Mlumbi-Peter emphasised South Africa's current compliance and the need to maintain credibility as a negotiating partner. She stressed the importance of ratification to protect South Africa's interests in global trade and mitigate risks associated with market access.

She highlighted the benefits to vulnerable groups and society, particularly coastal communities and small-scale fisheries, in protecting their livelihoods and ensuring sustainable resource management.

Ms Mlumbi-Peter emphasised the alignment of the agreement with South Africa's national and international obligations, the need for global cooperation in fisheries management and the promotion of sustainable development.

Ms Mlumbi-Peter further explained that extensive consultations had been conducted with various stakeholders, such as the Department of Forestry, Fisheries and Environment (DFFE), industry representatives and the Department of Transport (DoT). She highlighted the active participation of officials from the DFFE in the negotiation process, especially regarding environmental concerns introduced for the first time in WTO negotiations.

She iterated the importance of ensuring a comprehensive negotiating team representing both the DTIC and the DFFE perspectives. This was crucial as discussions progressed to phase two, which involved sensitive issues such as supporting artisanal and subsistence fisheries. Ms Mlumbi-Peter emphasised the necessity of securing necessary customisation of the agreement to address additional concerns of coastal communities and safeguard existing support mechanisms such as the fuel rebate.

In conclusion, she mentioned consultations with industry and labour, encompassing both large-scale and small-scale fisheries. These consultations aimed to gather input directly from stakeholders affected by the agreement.

See attached for full presentation

Discussion

The Chairperson thanked Ms Mlumbi-Peter for a clear presentation and opened the platform to questions from Members.

Ms S Boshoff (DA, Mpumalanga) thanked the presenter for the comprehensive presentation. She inquired about the fines implemented to prevent the plundering of stock along the coastline and the methods for monitoring coastline activities to prevent illegal fishing by individuals lacking proper permissions, licences or subsidies. She also raised concerns regarding unregulated fishing vessels or operators inaccurately reporting or failing to report their activities, thus seeking solutions to ensure accurate reporting. Was South Africa capable of effectively implementing the agreement?

Ms Boshoff sought insights into the expectations of MC13 outcomes and whether the agreement could be considered infallible through the suggested potential solutions to enhance its effectiveness.

Further, she queried the implementation of the Marine Living Resources Act 18 of 1998, regarding illegal activities by operators or vessels. She expressed concerns about unregulated fishing on the high seas, urging for regulations to address this issue during the MC13.

Lastly, Ms Boshoff requested information on the number of operators applying for the fuel rebate.

Mr M Dangor (ANC, Gauteng) expressed gratitude to the Chairperson and posed a question regarding the focus of the discussion: whether it pertained to the details of the agreement or its ratification. He sought clarification on whether the discussion would delve into the specifics of the agreement or primarily focus on the ratification process.

In response, the Chairperson acknowledged Mr Dangor's concern stating that while the discussion could encompass general clarifications, the Ambassador, being involved in the negotiations while based in Switzerland, was well-equipped to address both general and specific aspects of the agreement. The Chairperson affirmed that the discussion would proceed to the ratification process after addressing general concerns.

The Chairperson invited Members to raise any further questions or comments before allowing the Ambassador to respond.

Responses

Ms Mlumbi-Peter clarified the regulatory framework concerning fines for non-compliance with domestic laws, emphasising that such penalties were not governed by the WTO regulations but rather by South Africa's own legislative framework. She stressed the nation's sovereign right to oversee activities within its territorial waters and the importance of coastal states' autonomy over their marine resources.

Regarding coastal monitoring, Ms Mlumbi-Peter detailed the responsibilities of South Africa's forestry, fisheries, and environmental agencies in supervising surveillance activities along the coastline. South Africa has a reputation for excellent marine conservation efforts. The national conservation strategies are aligned to international frameworks, thus bolstering national conservation strategies.

Ms Mlumbi-Peter reaffirmed the WTO's specific role in addressing fisheries subsidies. She described its limitations concerning broader fisheries management and conservation issues, which fall within the responsibility of coastal states and organisations, such as the Food and Agriculture Organisation (FAO). She clarified the agreement's focus on limiting subsidies to address overfishing and overcapacity, with forthcoming phases aimed at addressing additional challenges.

In response to inquiries regarding addressing illegal activities and IUU fishing, Ms Mlumbi-Peter emphasised the pivotal role of South Africa's authorities in monitoring and enforcing relevant laws, including imposing fines or revoking transgressor permits. She stressed the prerogative of coastal states to identify IUU fishing within their waters and take appropriate enforcement actions.

Regarding the agreement's effectiveness, Ms Mlumbi-Peter acknowledged the usefulness of international agreements while acknowledging their potential limitations, particularly to persistent challenges such as overfishing and subsidy disputes. Ongoing considerations for a hybrid approach in subsequent phases, wherein subsidisation could continue under specific conditions to promote sustainable fishing practices, would be a solution.

Regarding the fuel rebate, Ms Mlumbi-Peter mentioned that operators typically apply through National Treasury (NT) and the DFFE. Specific data on the number of applicants are not readily available. She suggested that most operators would likely apply for the rebate, considering it as their primary benefit.

The Chairperson thanked Ms Mlumbi-Peter for her response. No additional questions were posed.

Committee’s Report on South African’s Ratification of the WTO Agreement on Fisheries Subsidies

The Committee Secretary (CS) took Members through the report.

Adoption of the Report

The Chairperson proceeded to facilitate the voting process. He requested that Members indicate their support for recommending the approval of the ratification to the House by raising their hands.

Voted in favour:

Ms M Moshodi (ANC, Free State) moved to adopt the report.

Mr M Dangor (ANC, Gauteng)

Ms M Mamaregane (ANC, Limpopo)

Mr M Mmoiemang (ANC, Northern Cape)

Mr M Rayi (ANC, Eastern Cape)

Ms S Boshoff (DA, Mpumalanga)

Mr J Londt (DA, Western Cape)

The Chairperson requested Members to lower their hands after voting. The CS confirmed that all Members were in favour of recommending the approval of the ratification.

Acknowledging the unanimous support, the Chairperson proceeded to announce the Committee's recommendation to the House for the approval of the ratification of the WTO fisheries subsidies agreement. He explained the subsequent process, indicating that the matter would be forwarded to the programming committee for scheduling in the House and eventual adoption by the National Council of Provinces (NCOP).

Expressing appreciation to the Members for their consideration of the agreement and Ambassador Ms Mlumbi-Peter and her delegation for their presentation, the Chairperson concluded the session. He excused Ambassador Ms Mlumbi-Peter and her delegation, stating that the Committee would now address internal matters.

Committee Business

The Chairperson addressed two important issues discussed during the management committee meeting held the previous day. The first concerns a letter received from the Chairperson of the Standing Committee on Finance and Economic Opportunities. The CS was requested to display or present the letter for review.

The second issue pertained to an invitation from the Department of Small Business Development or its agency, regarding attendance at an event. The Chairperson explained that it is a Global Entrepreneurship Congress Plus Africa (GECPA) conference, scheduled for 13 to 14 March 2024, with dinner on the Wednesday and the main event on Thursday.

He emphasised the need to confirm attendance, noting that while the conference is in Cape Town, it coincides with potential Committee or caucus meetings. He mentioned that there are no Committee meetings on Wednesdays, leaving 13 March open for attendance.

However, Thursday often involves caucus meetings, and isuggested that the programme for 13 and 14 March be verified to ensure no conflicting plenary sessions. He proposed addressing the Western Cape issue first before confirming attendance at the GECPA.

The Chairperson requested the CS to write to the Chairperson of the Standing Committee on Finance, Economic Opportunities and Tourism (WCPP) to acknowledge receipt of their request to amend the finalisation date of the National Small Enterprise Amendment Bill (NSEAB) [B16-2023]. He indicated that the matter would then be referred to the Portfolio Committee for consideration. The Chairperson requested the CS to read out the details for clarity.

The CS read out the letter addressed to the Chairperson regarding the request to extend the NSEAB finalising date. The letter outlines several key dates and concerns, including the need for more time to allow for public submissions and deliberations on negotiating mandates. The committee requests an extension until 19 March 2024, to adequately fulfil these requirements.

The Chairperson proposed the adjustment of the schedule to accommodate the request by moving the negotiating date to 19 March 2024, with the finalising date 26 March 2024. This adjustment was influenced by the upcoming constituency period and the uncertainty about reconvening thereafter.

The Chairperson emphasised the need for flexibility and proposed informing the appropriate parties of the proposed schedule change, allowing the Standing Committee to address their concerns regarding the Bill. He suggested sending a replying letter to the relevant parties for consideration alongside the Standing Committee's meeting.

Mr Dangor agreed with the request for an extension until 19 March 2024, with the final mandate on 26 March 2024, as discussed in the management committee meeting.

The Chairperson thanked Mr Dangor, and Ms Moshodi seconded the proposal.

The Chairperson confirmed that there were no contrary views, and the Committee agreed to the extension. The CS was tasked with writing a reply to the Chairperson of the Standing Committee.

Global Entrepreneurship Congress Plus Africa Invitation

The Chairperson requested individual responses from Members regarding their availability.

The CS mentioned that all Members were sent individual letters via email and were requested to respond before 16 February 2024. The Chairperson agreed to first establish if there were any competing activities on those days and then have Members indicate their availability.

Before discussing the tourism invitation, Ms Boshoff requested clarity on when the Members needed to confirm attendance for the Africa Convention.

The Chairperson said he would check the programme and committee meetings for that period and inform Members later that evening.

The CS then presented an invitation from the Department of Tourism for Meetings Africa 2024, scheduled from 26 to 28 February 2024.

The Chairperson noted potential conflicts with committee activities on the 27 February and suggested Members indicate their availability to attend.

Ms Boshoff expressed her unavailability for the tourism event on 26 February 2024, due to prior commitments.

 Mr T Brauteseth (DA, KZN) informed the Committee of his inability to attend due to provincial legislature activities on 27 and 28 February 2024.

The Chairperson noted his absence and suggested informing the Department accordingly. He also mentioned a Committee meeting the following day and requested a reminder for tomorrow at 4:00 PM.

The CS mentioned three sets of minutes to be adopted but the Chairperson deferred discussing them due to the amount of business already covered by the Committee today.

The CS provided an update on public hearings on the NSEAB, stating that only one stakeholder had confirmed their attendance so far, with others either submitting their submissions or indicating they would not be presenting orally.

The Chairperson attended to further logistics of upcoming meetings, thanked the Members for their attendance and contributions and adjourned the meeting.