In Case Of No-Deal Brexit, 6 Southern African Countries Have A New Trade Deal With The U.K.

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Written by Peter Pedroncelli
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The U.K. is one of South Africa’s biggest trading partners. Former British Prime Minister Theresa May, left, meets with South African President Cyril Ramaphosa in Cape Town, South Africa, Tuesday, Aug. 28, 2018. Photo – AP

With the threat of a no-deal Brexit looming, a collection of Southern African countries has agreed on a new deal that protects their trade relationship with the U.K., whatever happens. 

The new agreement governs the trade relationship and tariffs between members of the Southern African Customs Union, which includes South Africa, Lesotho, Eswatini, Namibia, Botswana, and Mozambique, and the U.K.

These countries enjoy duty-free benefits on 99 percent of goods going into the U.K. That would have gone away in a no-deal Brexit without a direct agreement between the African countries and the British government, according to the South African government.

That scenario would have hurt already struggling African economies, resulting in job losses.

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The U.K. is one of South Africaโ€™s largest trading partners with bilateral trade of aboutย $9.44 billion in 2018.

The former South African colonizer is set to officially leave the European Union on Oct. 31, with or without a withdrawal agreement.

A no-deal Brexit means that the U.K. immediately leaves the single market and customs union, forfeiting arrangements designed to help trade between European Union members by eliminating checks and tariffs.

At the moment, trade between the Southern African countries and the U.K. is governed under the European Unionโ€“Southern African Development Community Economic Partnership Agreement

That agreement allows for 99 percent of goods from the Southern African region to enter the U.K. market duty-free or partially duty-free.

The new trade agreement between the U.K. and the six African countries, called the Sacum-UK Economic Partnership Agreement, replicates the terms of the existing agreement relating to tariffs and health and safety regulations.

Exports from South Africa to the U.K. include precious stones, mineral products, vehicles, machinery and mechanical products, fruit and vegetable products, and beverages.